In Part 1 of this three part series I addressed where and how the net worth of the middle class was stolen. In Part 2, I will tackle who stole your net worth and in Part 3, why they stole your net worth. Now let’s zero in on the culprits of this crime.

Dude, Who Stole My Net Worth?

“Thus far, both political parties have been remarkably clever and effective in concealing this new reality. In fact, the two parties have formed an innovative kind of cartel—an arrangement I have termed America’s political duopoly. Both parties lie about the fact that they have each sold out to the financial sector and the wealthy. So far both have largely gotten away with the lie, helped in part by the enormous amount of money now spent on deceptive, manipulative political advertising.” Charles FergusonPredator Nation

When you dig into the charts and data supplied by the Federal Reserve generated report, the data which goes back to 2001 tells a story not addressed by the deceptive, manipulative, political propaganda that passes for investigative reporting by the captured mainstream media. The chart below compares the median versus mean income growth from the last three Fed consumer surveys. Overall, it reveals a lost decade of negative income growth for the average middle class family. In the early part of the decade the average middle class family made some progress as jobs were relatively plentiful and the internet crash mostly impacted the rich, who own most of the stocks in the country. This is why the median income rose while the average income fell. The wealthy have a large impact on the average because they own the vast majority of assets in this country. The stock market debacle was unacceptable to the oligarchs and their money printing puppet Greenspan.

Both the liberal and conservative wings of the ruling oligarchy were in complete agreement. A new bubble needed to be blown in order to refill the coffers of the ruling class. Paul Krugman spoke for the liberal wing:

“To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.”

Greenspan and his handpicked successor Bernanke represented the conservative wing by reducing interest rates to ridiculously low levels, failing to carry out their regulatory obligations, encouraging recklessness, and purposefully failing to acknowledge and deflate the greatest housing bubble in world history:

“American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage.” Alan Greenspan – February 2004

“House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals.” – Ben Bernanke – October 2005

“With respect to their safety, derivatives, for the most part, are traded among very sophisticated financial institutions and individuals who have considerable incentive to understand them and to use them properly.” – Ben Bernanke – November 2005

The master plan worked like a charm from 2004 through 2007 as you can see by the tremendous surge in average income. The stock market rocketed by 75% between 2003 and 2007 and national home prices shot up by 50%. Wall Street creatively invented no doc, negative amortization, interest only, subprime mortgages and generated a frenzy of demand from anyone that could scratch an X on a loan document, just as Greenspan had demanded. Being “sophisticated” financial institutions, they were able to assemble thousands of shit loans that were certain to default into one big derivative package of shit and their captured lackeys at the “sophisticated” rating agencies stamped a AAA rating on the smelly pile of feces. Always looking out for the best interests of their clients (aka muppets), the upstanding Wall Street firms sold the derivative piles of shit to them as can’t miss investments. Wall Street profits went off the charts. Billions in bonuses flowed to the rich and powerful Wall Street titans. Mega-corporations generated record profits as consumers utilized the Fed induced tsunami of easy debt to buy BMWs, 72 inch HDTVs, home theaters, stainless steel appliances, granite counter-tops, Caribbean cruises, Jimmy Choo shoes, and Rolex watches in a mad frenzy of consumer delusion.

What you might also notice in the chart above is that median household income somehow declined during this decadent orgy of corporate fascist pleasure. How could this be? Table 2 from the Fed report makes it clear. The vast majority of households in this country generate 75% to 81% of their income from wages. Virtually none of the income generated in 85 million households (the bottom 75%) comes from interest, dividends or capital gains. You need money to make money. The top 10% only generated 46% of their income from wages. The report does not provide details on the top 1%, but wages most certainly account for less than 20% of their income. Interest, dividends and capital gains represented 22.2% of the income for the top 10%, while it represented less than 1% of income for the bottom 75%. This data is the smoking gun that proves that Federal Reserve policy and control fraud on a grand scale by the titans of Wall Street was designed and executed to benefit only the wealthy elite billionaire class and their co-conspirators. All the income gains during this time accrued to the psychopathic amoral financial oligarchy. The average family saw their real wages decline and anyone lured into the housing market during this time frame by the “sophisticated” financial experts at Citicorp, Bank of America, Wells Fargo, Merrill Lynch, Countrywide, Washington Mutual, Wachovia, Bear Stearns, Goldman Sachs, Lehman Brothers, and the other members of the Too Big To Fail criminal syndicate was set up for epic loses.

Source of Household Income By Percentile of Net Worth

As expected, the psychopathic banker class could not be satisfied with the results of their looting. Their gluttonous voracious greed culminated in a historic collapse of the worldwide financial system resulting in a housing implosion, stock market crash and 8 million middle class Americans losing their jobs. The Fed report does show that average household income declined more than median household income after this historic financial oligarchy created collapse. One look at Table 6 from the Fed report will explain why. Only 15% of families own stocks and only 50% have retirement accounts. Approximately 50 million households in the country have virtually no stocks and less than 30% have retirement accounts. The top 10% wealthiest households, with a median household net worth of $1.2 million, proportionately own 3 times as much stock as the average family and 90% have retirement accounts. Therefore, the 57% crash in stocks impacted the top 10% to a greater extent, while the average family was most impacted by the 28% drop in home prices.

9 out of 10 Young People Don't Invest in Stocks

Despite the fact that the median net worth of the top 10% actual rose from $1.17 million in 2007 to $1.19 million in 2010 (while the bottom 80% saw their net worth decline by 36%) the losses in the stock market were intolerable to the banker predators and their captured government parasite politicians. All the “solutions” to the Wall Street induced financial debacle have been designed to benefit those who committed the crime and should have done the time. The singular design of those pulling the strings was to replenish the treasure chests on Wall Street, engineer a stock market rally to pump up the net worth and capital gain income for the 1%, and protect the vested interests of the financial elite. All the obscene criminally generated profits created during the boom were privatized into the grubby hands of the financial predators, while the subsequent gargantuan losses were socialized onto the backs of the American middle class taxpayers and future unborn generations.

TARP was rammed through the captured Congress by the oligarchs despite a 300 to 1 opposition from the public in order to protect obscenely wealthy bankers, stockholders and bondholders. The $800 billion of debt financed political pork, disguised as stimulus, was doled out to corporate contributors, union thugs, and a myriad of other special interests. Zero interest rates are specifically geared to generate billions of risk free profits for Wall Street and to force retirees to gamble their dwindling retirement funds in the rigged stock market. Bernanke and Paulson threatened the limp wristed pocket protector CPAs at the FASB into allowing Wall Street banks to make up the value of their loan portfolios in order to mislead the public regarding their insolvency. The tripling of the Federal Reserve balance sheet from $950 billion in September 2008 to $2.9 trillion today was done to remove the toxic assets from the balance sheets of the Too Big To Fail Wall Street cabal at 100 cents on the dollar. QE1, QE2, and Operation Twist have had the sole purpose of providing the “sophisticated” financial elite with the funds to pump into the stock market using their high frequency trading super computers.

The subsequent Federal Reserve contrived 100% increase in the S&P 500 has repaired the damaged balance sheets of the moneyed interests, while the average middle class family has sunk further into debt and despair. The powerful entrenched sociopathic marauder class cares not for the average middle class American. They can barely conceal their contempt and disgust for the masses as they blatantly flaunt their hegemony and supremacy over our decrepit decaying corrupted economic system. M. Ramsey King described the disgusting display last week:

“Jamie Dimon’s appearance before the Senate Banking Committee was a sickening display that clearly demonstrated that Congress has been thoroughly corrupted by Wall Street. Instead of grilling Dimon, Senators acted like overly affectionate puppies fighting each other for an opening to smooch their master.”

The destruction of the middle class has been methodical and systematic. The top 10% of earners had a median net worth of $1.19 million, or 192 times as much as the median wealth of $6,200 of those in the bottom 20% in 2010. In 2007, the top 10% had 138 times as much wealth as the bottom 20%. In 2001, it was 106 times as much. With the continued rise in the stock market, declining real wages for the middle class, and further home price declines, the gap between the top 10% and the bottom 20% has continued to widen. The level of pain being experienced by the middle class has reached an unprecedented extreme. A few data points from David Rosenberg make that clear:

  • Forty-six million Americans (one in seven) are on food stamps.
  • One in seven is unemployed or underemployed.
  • The percentage of those out of work defined as long-term unemployed is the highest (42%) since the Great Depression.
  • 54% of college graduates younger than 25 are unemployed or underemployed.
  • 47% of Americans receive some form of government assistance.
  • Employment-to-population ratio for 25- to 54-year-olds is now 75.7%, lower than when the recession “ended” in June 2009.
  • There are 7.7 million fewer full-time workers now than before the recession, and 3.3 million more part-time workers.
  • Eight million people have left the labor force since the recession “ended” — adding those back in would put the unemployment rate at 12% instead of 8.2%.
  • The number of unemployed looking for work for at least 27 weeks jumped 310,000 in May, the sharpest increase in a year.

I would add a few more data points to David’s list of woe:

  • Over 7.5 million homes have been foreclosed upon by the Wall Street bankers since 2008.
  • The National Debt has increased by $5.7 trillion (57% increase) since September 2008, while real GDP has risen by $305 billion (2.3% increase) since the 3rd quarter of 2008.
  • Interest income paid to senior citizens and savers has declined by $400 billion (29% decline) since September of 2008 due to Ben Bernanke’s ZIRP.
  • Government transfer payments have risen by $500 billion (32% increase) since September 2008, while private industry wages have risen by $200 billion (4.7% increase).
  • The price of a gallon of gas has risen from $1.70 in December 2008 to $3.53 today.
  • Food prices have risen by 7% to 10% since late 2008, even using the falsified BLS data. A true assessment by anyone who actually goes to a grocery store (not Bernanke – his maid does the shopping) would be a 10% to 20% increase.

The middle class has a gut feeling they are being screwed by somebody, they just can’t figure out who to blame. The ultra-wealthy elite keep up an endless cacophony of propaganda and misinformation designed to confuse an increasingly uneducated and willfully ignorant public while blurring the facts for those educated few capable of understanding the truth. They have been able to keep the masses dumbed down through government run education; distracted by sports, reality TV, Facebook, internet porn, and igadgets; lured by mass media messages of materialism; and shackled with the chains of debt used to acquire the goods sold by mega-corporations. We’ve become a society oppressed by a small faction of ultra-wealthy masters served by millions of impoverished, uneducated, sedated slaves. But the slaves are getting restless and angry. The illegally generated wealth disparity chasm is growing so large that even the ideologue talking head representatives of the elite are having difficulty spinning it. Even uneducated rubes understand when they are getting pissed on.

“Senator, don’t piss down my back and tell me it’s raining” – Fletcher – Outlaw Josey Wales

The situation is growing increasingly unstable and has left the country susceptible to an extreme outcome when this teetering tower of debt topples.

The moneyed interests have brilliantly pitted the middle class against the lower classes through their control of the media, academia, and the political system. They have cleverly blamed the victims for their own plight. They have convinced the general public that millions have lost their homes to foreclosure because they were careless, greedy and stupid. They blame the Community Reinvestment Act. They blame others for taking on too much debt when they were the issuers of the debt. The Wall Street moneyed interests created the fraud inducing mortgage products, employed the thousands of sleazy mortgage brokers, bullied appraisers into fraudulent appraisals, paid off rating agencies, bribed the regulators, bet against the derivatives they had sold to their clients, threatened to burn down the financial system unless Congress handed them $700 billion, and paid themselves billions in bonuses for a job well done. But, according to these greedy immoral bastards, the real problem in this country is the lazy good for nothing parasites on food stamps and collecting unemployment, who need to stop complaining and pick themselves up by their bootstraps and get a damn job. It’s a storyline used against Occupy Wall Street and anyone who questions their right to plunder what is left on the carcass of America. The vilest fraud in the history of man was perpetrated by these evil men and not one executive of these firms has been prosecuted. Obama, the champion of the little people, has proven to be nothing but a figurehead for the powers that be. Proof that the Wall Street syndicate is winning the war couldn’t be any clearer than the fact that the top six criminal banks now have 40% more of the nation’s assets in their vaults than they did before they burned down the economy.

The demonization of the victims continues, while the perpetrators prosper. The sociopaths appear to be winning; just as they seemed to be winning in the later stages of the Roman Empire.

“And we often fall into this bias on the prompting of con men and sociopaths of the predator class who use it to justify their own criminal actions and personal injustice. They are not burdened with empathy for their victims, and even delight in their misfortune. But they must find ways to make their actions more acceptable to society as a whole that normally does have such concerns for equity and justice.”Jesse

“Are we like late Rome, infatuated with past glories, ruled by a complacent, greedy elite, and hopelessly powerless to respond to changing conditions?” – Camille Paglia

I think you know the answer to this question.

If you missed the first part of this series, CLICK HERE to read it.

// ‘);document.write(String.fromCharCode(60,47,83,67,82,73,80,84,62));
// ]]>


This entry was posted in General. Bookmark the permalink.
  • First check the link to part 1 it comes up to the Burning Platform..??
    I generally start the attack on the Middle Class with Ronnie Regan’s busting of the Air Traffic Controllers union.. That began the assault on unions, pensions, and health care.. Then the outsourcing of jobs started in earnest and we get to your starting point Clinton…
    Who in my estimation has done more damage than all others with his NAFTA, GATT, WTO and deregulation of the markets.. Throw in a couple of unnecessary wars and the taking of congress by a bunch of radicals who will destroy the rest before they are done.. This coming election will be the decider.. If the radical right gain more control and particularly if they gain control of the Senate it will be all over for the working man.

    The Average Stiff, during this period would appear on the surface to be a bunch of fairly stupid people , but when I look down in the trenches I see folks that were put to sleep by the razzle dazzle of the financial wizards (criminals at least) into believing that there houses were an investment and the money over their mortgage and their money and they should spend it.. If I remember correctly adds of the day were saying just that.. It’s your money spend it.. and they did.. and while your at it here’s a credit card zero interest of x years with a high credit line.. It’s yours spend it , and they did.. Today is wakeup day… Their houses are gone in a lot of cases, the credit card interest is 30% , all of “Their Money” is spent and the inflation of every day living is eating them alive..
    As you point out, half of young college grads are not working, some are working out of their fields for low wages.. Even wages in their field are starting at money barely adequate to pay their student loans..
    Where do we go from here.. I hope your part 4 answers that question.. When you post that I will give you my solution.. Most , won’t like it but I know it would work. so we shall see what your fans say.. can’t wait.
    As always you have a way of hanging it all together that I love..

    • kiwichris

      sorry to burst your bubble Mr. Cat but this election will decide nothing – it’ll be business as usual and anyone thinking that something positive is going to be done to halt the slide by whoever wins the election is frankly delusional and needs to grasp the bigger picture. Thinking along those lines is what the elite want. divide and conquer -democraps v rethuglians, liberals v conservatives, black v white, – it’s all one in the same. Meanwhile loot steal and suppress. The Occupy Movement are right- the only thing that may stop the slide back into complete modern serfdom and slavery is to shut the machine down, reintroduction of debt free money, and lots of politicians, bankers, corporate toadies and their enablers from the media either in jail or swinging from lamp posts. Only then will things change.

  • gozounlimited

    Since the economic crisis hit America, more than 2.5 million homes have been foreclosed in the US. The impact hasn’t only been financial, but some Americans who have been forced on the streets have decided to take their own lives. Here is our report.

    Home foreclosures drive Americans to suicide?

    see video: http://www.prisonplanet.com/home-foreclosures-drive-americans-to-suicide.html

    • gozounlimited

      The planned destruction of Main Street continues ….. US STOCKS-Wall St drops on data, Goldman bearish call….

      The Recession Threat Is Growing Around The World, And Goldman Says The Fed Won’t Do Anything About It (So take down the S&P500 damn it!) …..

      read more: http://www.businessinsider.com/recession-threat-goldman-says-no-qe-2012-6

      GOLDMAN: GO SHORT! (Teach Those Fedsters)

      We are recommending a short position in the S&P 500 index with a target of 1285 (roughly 5% below current levels) and a stop on a close above 1390. This morning, the Philly Fed print of -16.6, down sequentially and worse than expected, provides further evidence that weakness has extended into June.

      Read more: http://www.businessinsider.com/goldman-go-short-2012-6
      Guess they had to act before positive unemployment numbers were published today…..
      read more: http://www.dol.gov/opa/media/press/eta/ui/eta20121273.htm
      Goldman hopes you don’t know this …..

      Today’s economic numbers are mixed but forward momentum is still positive according to the index of leading indicators. This index posted a better-than-expected 0.3 percent gain for May after an unrevised 0.1 percent dip in April and marginally revised 0.2 percent gain in March (previously up 0.3 percent). Strength in the latest month was in building permits (+0.21 percent contribution), the Treasury/fed funds spread (+0.18 percent contribution), and in the ISM new orders index (+0.10 percent contribution). The key negatives were the factory workweek (-0.13 percentage contribution) and stock prices (-0.13 percentage contribution).

      The coincident index rose 0.2 percent, matching the pace in April, indicating that current economic activity is moderately positive.

      Overall, the economy has been slow but it is continuing to grow.

      read more: http://bloomberg.econoday.com/byshoweventfull.asp?fid=452488&cust=bloomberg-us&year=2012&lid=0

      Read more: http://www.businessinsider.com#ixzz1ySK5cTDa

      • gozounlimited

        More Fraud Perpetrated Against Main Street …. New Evidence that Wall Street Has Moved Into a Cartel-Type Brand of Criminality

        A breathtakingly broad scheme to skim billions of dollars from the coffers of cities and small towns across America by secretly colluding to rig the public bids on municipal bonds, was recently uncovered in a federal court room in Lower Manhattan. By conspiring to lower the interest rates that towns earn on these investments, the banks systematically stole from schools, hospitals, libraries and nursing homes – from “virtually every state, district and territory in the United States”. And they did it so cleverly that the victims never even knew they were being ­cheated. No thumbs were broken, and nobody ended up in a landfill in New Jersey, but money disappeared, about 3.7 trillion, and its manner of disappearance had a familiar name: organized crime.

        read more: http://www.rollingstone.com/politics/news/the-scam-wall-street-learned-from-the-mafia-20120620?print=true

  • JimQ,

    You are helping to convince me that Reich was on to something when he said he suspected that a coup d’etat of some sort has taken place.

  • Cheyenne

    This is one of the most trenchant summaries of the fraudulent left-right puppet show I’ve come across. Extra points for ripping TARP and quoting The Outlaw Josey Wales AND Le Proprietaire himself.

    Taibbi has a fantastic piece today that contains this nugget toward the end:

    “There are some who think that the government is limited in how many corruption cases it can bring against Wall Street, because juries can’t understand the complexity of the financial schemes involved. But in USA v. Carollo, that turned out not to be true. ‘This verdict is proof of that,’ says Hausfeld, the antitrust attorney. ‘Juries can and do understand this material.'”

    That should (but of course won’t) give Quinn’s “entrenched sociopathic marauder class” pause. First, it signals that ordinary Americans are seeing right through Wall Street’s “greed” line and straight to the crimes lying at the root of their ills. Second, it was a jury that landed the blow here–on behalf of that rarest of breeds, a prosecutor. Juries can do the same thing for a defense. It’s called nullification. The pinstriped thieves are insane to believe they’ll remain above the law forever.

  • Stung

    “Limp wristed”?! Seriously? I wasn’t ready for gay baiting right there, my defenses were just napping peacefully, wow. Ya got me with that one.

  • bert

    ask Alex Jones he know it all Alex ´´the Arabs own Hollywood´´ Jones can not say the J word .. noooo not the J´´ermans or the J´´oslems put the people in prison in Europe for 12 years for thought crimes … Ok the 7 OWNERS of the FED are Adolf Hitler and the Nazis right?? Come on Alex´´ they always lie , but in the history of the second world war ´´they´´ always speaking just the genuine truth