Tax cut bill is anything but for middle class America

You can tell by the amount of spin that the Trump tax cut will not work out well for the remaining middle class Americans.

As the President marched out families who would benefit with lower tax bills if the bill is passed, I said to a colleague that we are screwed big time by this based on the dog and pony show we were watching. Continue reading

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Bernie Sanders spit the bit on Monday

Here’s what I find astounding from the opening night speeches of the Democrats at the national convention.

Although it has been eight years of economic malaise under President Obama, it is the Bush administration’s fault that wages haven’t risen in over that time. It’s not the Democrats fault real GDP growth over 2.5% hasn’t occurred and that the middle class has almost disappeared.

How can you cite the growing schism between the haves and the have-nots over the last eight years and not take responsibility for it?

How can you not cite the record number of Americans working part-time jobs, but wishing for full-time employment. You can’t cherry-pick data — oh, well maybe you can — and then blame the guy before you and the guy who may come after you.

As I have written before in one of my most read posts, Obama instituted through his policies the greatest transfer of wealth from the middle class to the one percenters in the history of the earth.

It makes 17th century France look like a tyros in their execution and we know the king and queen lost their heads over that.

It is beyond comprehension for Sen. Elizabeth Warren to chastise Congress, when it was the White House that through lack of leadership became the first president in history not to record one year of 3% GDP growth. Even Franklin D. Roosevelt hit that mark during the Great Depression.

As for Sen Bernie Sanders, he cited the numbers under Obama, but still harkened back to Bush and then jumped to Donald Trump’s policies as being the same.

I’m guessing the last eight years were a black hole, where no inept policies will ever escape into the light of day.

As for Sanders, he blew it. He says he started a revolution, but he did not wish to finish it.

He should have stood at the podium Monday night and declared to Hillary and the convention, that she release her delegates and have an open convention.

He should have demanded that since the primaries and caucuses where not a level playing field that the vote be done on the floor. Win or lose he would have made history.

But, his people negotiated a plane ride and some other amenities for his endorsement. Not historic at all.

Hey Janet, can you spare a trillion for what's left of the middle class?

I’m not sure what economists are seeing, but from where I sit, we have a global recession taking hold.

It’s really quite simple. The monetary policies of the last 7 years in the US and more recently in Europe and Asia have been directed towards banks, which in turn have put that cash to work in the markets. These actions by the banks have created asset bubbles in the equity and bond markets.

Very little of this “helicopter money” has made its way down the food chain in the form of higher wages. So you have stealth inflation, due to commodity prices rising on sugar, corn, wheat and meats.

In the US at least, you have a “robust” jobs recovery where people are working two lousy part-time jobs or more with no benefits, to make up for the one full-time job they lost which provided a middle-class existence for them.

The Federal Reserve Bank of Atlanta, which allows its economists to speak something closer to the truth on the economy through its GDPNow survey, slashed its Q4 projection for GDP almost in half yesterday on weak manufacturing numbers here. The prior projection was a “robust” 1.3% growth. GDPNow has it at 0.7% growth.

For the holiday quarter with all the consumer spending, which is 70% of the economy and hence the GDP, we come out with sub 1% growth.

What does that tell you? It tells me its a recession. Don’t give me textbook definitions of a recession. The Federal Reserve’s actions over the last 7 years have perverted what we thought was true, that you needed 2 quarters of sub 0% growth to be called a recession.

Trillions upon trillions awash in the markets, propping them and the bulge bracket banks balance sheets up and we get to do the same job we had in high school to support a family.

By Janet Yellen’s definition we are not seeing any inflation, because the first place you look to see if there is price acceleration is in wages. But the Fed has not sterilized the trillions printed by allowing it any velocity in the greater economy, so naturally we get that “US inflation is running below the Fed’s 2% trend” line every time Yellen speaks.

The $4.8 trillion question is why is the monetary policy of the US to have wages stagnate so that they are by to 1995 levels, if the Obama Administration wants growth?

What’s the use of having a Fed, which has a mandate of full employment, cite a jobs recovery where average hours worked is below 30/hrs a week? Or have just under 50% of the population receiving some form of government assistance?

The US will never have an economic recovery with those type of numbers. What you will see is what the stats show. A disappearing middle class and a disproportionate compensation ratio between the haves and the have-nots.

The Federal Reserves has all the tools in the world to combat inflation, it has no tools to fight deflation and a recession if they are already at zero or near-zero rates. So why is the Fed and the Treasury Department not allowing some of this printed money get into the economy in the form of business and personal loans?

A trillion dollars in infrastructure projects given to private industry would do more for the economy, than a trillion to the Wall Street banks to buy treasuries, which it sells back to the Fed.

But if we did that we may impair the bank’s balance sheet. Would not want another Lehman Bros. on our hands, would we?