Okay I was reading the comments about the elites, one of my prefered targets for the state of the world affairs.
Compared with the elite in Egipt ours are very very compassionate in the way they treat us the small people, which is good.
From a self determination of the masses perspective; that grew popular in the past 200 years, (elite lost some influence since then) they are bad.
The elite is the ruling class.
Access to power is not determined by reaching and holding public office, politicians come and go.
Access to power means the very few that rule, set the norm and what is allowed from a legal standpoint.There lay the crux of the matter in my view.
Access to power to write the law to protect what they have, and because they have a lot, means that their interests are intertwined with the fate of a nation.But they don't have nation.
Being rich doesn't mean belonging to the elite, a rich person just have money because of talent, luck, marriage or wealthy parents. They are passive, they just have money, period.
Think now about the robber barons again, industrialists and bankers in the XIX century.Yes generally speaking we say that they were all robber barons.Bankers and industrialists.But if we become more selective we find that a lot of them lived, procreate and died. Still passive, just with money.
Now imagine the Standard Oil and imagine all the antitrust laws sanctioned to protect a little, the common person from the "company store" if you got the meaning of the song; and now fast forward several decades and think about Exxon.
It didn't change, why? Because they never ceded power. They were always in charge they hold effective power.Things in a nation are made to protect and please them; that is the bottom line, and this is possible because they are the ones fomenting all the necessary laws to protect and please themselves.Fomenting in the rest of us passive dettachment, a state of confusion or a sense of pride that we made it, reaching "almost" their stature.
The elite is not passive like the rest of the population rich, middle class or poor.The elite never abide by a social contract where others deserve a place under the sun.We are just instrumentals.
Even the rich around them are just a buffer, so they don't become a clear target.
The elite is active, they rule, they make the laws and actively try to protect what they have demanding more, and then a little more (that's the tactic) they don't settle, so don't try to appeal to a sense of fairness because even though that will mean the betterment of a nation in their view they own nations. For them will mean that they are settling, that they can not expand anymore.And that the feudal times are not coming back again.
Have you ever considered that without the elite China wouldn't have been able to get where it is today?
And do you think they didn't know that they were going to emasculate America since Nixon and Carter set foot in China?
They can not be considered traitors because "their nation" is just the elite.
Like I said above they don't look for the betterment of a nation they cannot have that concept since they "own" nations and just want to expand to have more and more, no matter what.
Well those are the elite.
Didn't do anything new in the market just waiting and see what happen the 6th and 12th.
Dan
Thank you, Dan. Couldn't have (and didn't say) said it better myself.
ReplyDeleteFor me, this is the money passage:
ReplyDelete"The elite is active, they rule, they make the laws and actively try to protect what they have demanding more, and then a little more (that's the tactic) they don't settle, so don't try to appeal to a sense of fairness because even though that will mean the betterment of a nation in their view they own nations. For them will mean that they are settling, that they can not expand anymore.And that the feudal times are not coming back again."
It's never enough (and never will be) for them. They have to keep pushing for more. It's in their genetic code.
@Dan,
ReplyDeleteMonarchy replaced by an "elite" system. In a democracy, the opportunity is there for anyone to become one. Born at the right time, at the right place and many other factors can contribute to one's success! Many politicians, judges, businessmen, etc are such examples.
ICan
Here we go. Topic is now in the MSM zeitgeist. They will keep chipping away at what little power We the Sheeple have left, until there's truly nothing.
ReplyDeletehttp://www.nytimes.com/2011/01/04/business/04labor.html?_r=1&hp
^ in India,
ReplyDeleteICan
This quote is PRICELESS. So, now it are the public UNION employees that are the "HAVES", but not the uber-wealthy or the elites? Wow, we are truly idiots if we go along with this meme.
ReplyDelete“We can no longer live in a society where the public employees are the haves and taxpayers who foot the bills are the have-nots,” Mr. Walker, a Republican, said in a speech. “The bottom line is that we are going to look at every legal means we have to try to put that balance more on the side of taxpayers.”
"Goldilicks in China? Euro zone CPI heats up". Peter Boockvar at ritholtz.com
ReplyDelete"China reiterated that they will be Spain's sugar daddy and will buy Spanish debt...With Europe being China's largest trading partner, China has no choice but to support the region".
ICan
Wonder why we don't hear more of this from the MSM? I think that's an easy one to figure out.
ReplyDeletehttp://www.huffingtonpost.com/2011/01/04/most-americans-say-tax-th_n_804020.html
The second highest thing in the poll Americans said to do was cut defense spending. I'm sure we won't see this poll results on FOX or most other MSM outlets.
ReplyDeleteThis is just truly outrageous:
ReplyDeletehttp://www.ritholtz.com/blog/2011/01/bofa-putbacks-freddie-mac/comment-page-1/#comment-480176
And on that topic:
ReplyDeletehttp://www.nytimes.com/2011/01/02/fashion/02studied.html?_r=2&ref=health
@Manny,
ReplyDeleteIt is all outrageous, and there is little we can do about it as the sheeple keep voting against their best interests.
Dan,
ReplyDeleteGreat post. What you say is absolutely true.
"In an apocryphal but oft-cited exchange, Hemingway supposed the rich to be different only because they had more money. But, as Fitzgerald rather presciently wrote in his story “Rich Boy,” because the wealthy “possess and enjoy early, it does something to them,” surmising, “They are different from you and me.” Score one for Scott."
ReplyDeleteInteresting that they would state the obvious.
New 52-week high for F.
ReplyDeleteWe are breaking the lows from yesterday, we'll see if the gap gets filled.
ReplyDeleteTo Beat Back Poverty Pay The Poor
ReplyDeleteToday, however, Brazil’s level of economic inequality is dropping at a faster rate than that of almost any other country. Between 2003 and 2009, the income of poor Brazilians has grown seven times as much as the income of rich Brazilians. Poverty has fallen during that time from 22 percent of the population to 7 percent.
Contrast this with the United States, where from 1980 to 2005, more than four-fifths of the increase in Americans’ income went to the top 1 percent of earners. (see this great series in Slate by Timothy Noah on American inequality) Productivity among low and middle-income American workers increased, but their incomes did not. If current trends continue, the United States may soon be more unequal than Brazil.
Such a different attitude than our own country's "Fuck the Poor".
ReplyDeleteVery interesting article, Denise.
ReplyDeleteElitism sure is popular this new year:
ReplyDeleteThe Rise of the New Global Elite
"In a plutonomy there is no such animal as “the U.S. consumer” or “the UK consumer”, or indeed the “Russian consumer”. There are rich consumers, few in number, but disproportionate in the gigantic slice of income and consumption they take. There are the rest, the “non-rich”, the multitudinous many, but only accounting for surprisingly small bites of the national pie. "
Plutonomy, a new word in the lexicon.
The disproportion of income is world wide and growing worse. Not a good thing when the Have Nots out number the Have by the billions.
Ticks can barely top 500 since the open, which doesn't bode well for the market today.
ReplyDelete@dss(11:15)
ReplyDeleteWorld-wide, indeed.
ICan
Except in the "socialist" nations such as Scandinavia. Those hell holes known as Sweden, Denmark, and Norway are just prime examples that socialism is a failure. When will they learn?
ReplyDeleteNew tick lows, new price lows. We are filling the gap little by little. Maybe a down day? Is there such a thing anymore?
ReplyDeleteOil is collapsing. Can stocks be far behind?
ReplyDeleteFeb Crude is down 2.74%
Home builders XHB down 2.04%
ReplyDeleteGold down 2.61% (-$37.01)
February Silver down 4.11%
ReplyDeleteSLV -3.04%
Turnaround Tuesday. Profit taking. We'll see what happens on the 5th, as Dan is waiting.
ReplyDeleteICan
Many waited until 2011 to make sales to lock in some capital gains for this year. We are so overbought that a pull back should happen but we will see how this unfolds.
ReplyDeletePopped stops - good post at Corey's blog- afraid to trade. H&S?
ReplyDeleteICan
Corey is one of the best, plus his analysis can be applied to all time frames. (disclaimer, I was a subscriber in the past)
ReplyDeleteWe have hit the 1st support at 126.20 SPY, but the gap from the close of 12/31/10 is at 125.73.
ReplyDeleteJan, Feb are slower months for oil - "less driving" season. Unless U$D really goes down, or someone like China is filling reserves or war breaks out in the Middle East, oil shouldn't move much higher.
ReplyDeleteICan
Dan - Thanks for taking the time to share your insight and thoughts.
ReplyDeleteGreat Post
Mangy Mutt
Hey guys!!! Freezing our asses off here in London!
ReplyDeleteI am NOT a cold weather person, and I know Manny and Denise are shaking their heads at my bitching about 30 degrees :-)
I have a hard time finding my car keys and glasses at home, I don't know how I could survive here, I've already lost my scarf and hat!
The VAT increase is on the news here - it just went from 17.5 to 20%
Things here are expensive, even outside London (went to salisbury and Stonehenge) today. Everything like water, and sodas come in smaller bottles but cost more!
Thor!
ReplyDeleteSorry to hear of the cold weather. England is pricey, but so worth it! Didn't hear a word about the VAT.
We have missed you, can't wait till you come back.
Well, I got my Turnaound Tuesday, didn't I?
ReplyDeleteadding on higher lows....
Hope we are not back to the beach ball trade again.
ReplyDeleteOn the weekly S&P, we may have the start of the Bird formation.
ReplyDeleteIt's not as pronounced as I'd like to see, so we may just be under a little pressure for this week. We'll see.
But, as ICan said, tomorrow was Dan's first day for the possible correction, wasn't it?
Stopped out of my PAAS. I'm thinking I'll hold for a higher low before I re-enter. Opportunities abound.
And, do I see the VIX.X range bound at 16.90 to 18.25? Hmmmmm, nowhere to go but up?
Thks Dan.Your take is probably more objective / less emotional than mine.
ReplyDeleteRock,
ReplyDeleteI have never heard of the bird formation. What is that?
re I Can
ReplyDeleteIn a democracy, the opportunity is there for anyone to become one. I disagree with that. I believe there's one barrier that can prevent someone from ever getting access to thie "top of the social strada": it's called morality.
I'm fairly confident in stating that members of the elite (politics and CEOs) have developed an ability to lie as they breathe.
Thor - Nice of you to stop by while on vacation.
ReplyDeleteOther then you loosing everything that is not attached to you, I hope you are having a great time.
Mutt
Not everyone can afford that. Many people wouldn't trade their dignity for a possible top status rank.
ReplyDeleteSometimes, that makes me think that instead of having the best people to lead our nations, we actually end up having the worst (morally speaking).
Perfect example of the "popped stops" set up just occurred. Shorts were sucked in with the little dip at 126.50 and then blam!
ReplyDelete@Wolfie,
ReplyDeleteUpward mobility is at it's worst in the US, far lower than many countries in Western Europe.
The WikiLeaks strategy: Bank of America buys up abusive domain names
ReplyDeleteHah! Can't believe I missed this.
Wow, emmy. I wonder if this is someone's full-time job?! LOL. "Director of Abusive Internet Domain Names Procurement"?
ReplyDelete@Wolf
ReplyDeleteAgree with you on the morality issue. What I hate is the issue of entitlement, better-than-thou attitude and talking down to people. In India, politicians and new elites(some of them got jobs through quota programmes, and not based on merit or hard work) go on to loot the treasury ASP. Most of them - in every state front run( ie, buy up assets -land etc- they know will be approved by them for govt. projects) and rake in billions of rupees. Everyone thinks Indian elites are hidding their assets in Swiss banks - huge amounts.
That's why I am for 2 time term limit for all politicians at all levels of the govt. everywhere.
I think in India - it's people's fault too for not demanding better governance. Political parties are like cancer, they have their roots in every aspects of life - sports, religious gatherings, control news media, village politics etc. Masses are ignorant of their own rights too.
Lack of critical thinking!
ICan
Manny and Dan,
ReplyDeleteI've appreciated your comments yesterday and today. I grew up with FDR-adoring parents whose families survived because of WPA/CCC jobs, and have to watch myself for knee-jerk reactions to blame nameless rich/big-business/elite. But, you've helped clarify things, and I agree: there is a powerful, controlling core group that protects itself to the detriment of the everyone else. Hard to pin down, but real. Thanks for helping raise the curtain on them.
Kayem
@Denise: Beach ball. The shorts are going to go broke shorting this market before all is said and done.
ReplyDelete@Kayem: I think my issue with the "elites" nowadays is that they seem out of control and unchecked. For them, it's a race to the top, as they try to live up their peers so their behavior of always pushing for more (to the detriment of everyone else and the nation itself) among their peers become more and more accepted, especially if there's nothing left to call them out on it and check them(e.g. the media our politicians, churches and other powerful instititions, which has clearly been bought off). Read "Death of of the Liberal Class" by Chris Hedges. I'm over halfway through it and I think he lays it out there in clear (albeit very depressing) terms that make a lot of sense. There's just no way we can deny this is happening any longer.
Manny,
ReplyDeleteYes. Power begets power. Checks and Balances? Why, that's a quaint term from civics classes - but doesn't exist anymore in government or in society/cultural institutions.
Kayem
Nice rally into the close. So much for thinking we might have a down day today.
ReplyDeleteThere are people out there who are doing their jobs honestly. Not every politician or an elite is corrupt. Some media outlets are doing excellent job calling out the culprits and people are waking up, demanding their rights.
ReplyDeleteIndia has a huge chellange managing so many diverse languages/religions/class systems etc. And they have China and Pakistan at the door threating their security. Still there is reasonable amount of freedom of speech.
ICan
True, I Can, but those remaining honest folks are really fighting a growing tide.
ReplyDelete@Manny,
ReplyDeleteThis meltdown forced the curtain to be pulled back and the naked power grabs and unbelievable greed were exposed. It has been 30 years in the making with Reagan starting the anti-union, anti-middle class, anti-regulation death spiral and Greenspan with his failed Libertarian "we don't need no stinkin' regulations" economic policies, enabled by his powerful allies in government and the corporate world.
Yet despite the fact that the deregulation (so that the elite and moneyed ruling class could to make ever more money) of all facets of our economy has led to Black Swan events happening every few years, no one has the guts to stand up and say "deregulation and mis-placed free market satanic like worship has destroyed our economy".
Even today the free market and deregulated economy is treated like the Holy Grail, simply because TPTB make so much money from unregulated markets, it is just like getting fleeced by a carny with fast hands.
The economy, the debts, the people can all go to hell because they already got theirs, enough to protect them from any fall out in the world's economies.
Back home.
ReplyDeleteYes the 6th is a day that could mark a sharp movement.
Watching the markets today makes me wonder if is not going to happen the nov 16 kind of action again.
Falling but not much and Thursday or Friday sharp reversal, so the 6th will rather be the end of the correction instead of the start just like happenned in mid nov.Will see.
And Jan 12th is still in the cards but looks a little bit weaker in it's strengh to affect price action.Will see.
Keep in mind that since september when I mentioned that chances were that we move up in the middle term means that the trend will be still up and April-May as a chance to get a bigger down move, so no huge huge drop from my uneducated point of view at least for several months, 5% 10% maybe but not 30% or 40%.Will see.
Dan
Thanks Dan, for the update.
ReplyDeleteManny, here is a cool website that ties in well with our discussion:
Little Sis - Profiling the Powers That Be (As opposed to Big Brother says the website)
Includes:
Paid For Politicians
Corporate Fat Cats
Revolving Door Lobbyists
Secretive PACS and Front Groups
Think Tanks and Philanthropies
16,923 organizations, 54,803 people, and 261,016 connections between them.
Data Summary
780,203 Citations
261,009 Relationships
52,780 Persons
22,017 Business Persons
16,315 Organizations
11,114 Lobbyists
5,391 Businesses
5,002 Political Fundraising Committees
4,628 Political Candidates
1,994 Elected Representatives
1,942 Individual Campaign Committees
1,612 Other Campaign Committees
1,319 Lobbying Firms
1,105 Government Bodies
1,070 Public Companies
962 Schools
829 Public Officials
812 Other Not-for-Profits
573 Philanthropies
531 Private Companies
342 Lawyers
318 Membership Organizations
274 Academics
196 Industry/Trade Associations
165 Political Parties
141 Policy/Think Tanks
136 Media Personalities
97 Law Firms
90 Cultural/Artses
76 PACs
73 Public Intellectuals
56 Media Organizations
48 Consulting Firms
34 Professional Associations
26 Labor Unions
22 Public Relations Firms
13 Social Clubs
11 Government-Sponsored Enterprises
I am going to spend a little time looking at this site. It sounds intriguing and it is one of the things that the internet does best.
ReplyDeleteI think the elites like a portable empire.
ReplyDeleteCouple centuries ago in Europe and migrating and pouring their capital here.Of course there are newcomers in this case the locals so is something that keeps moving and now investing on China.
Two of their objectives are to mantain sacred property rights, so they can own if they want a mountain full of gold in Bolivia or diamonds in Africa and everybody accept that fact because they exchange some piece of paper for that mountain,
And time (preservation of the status quo) because time means compound interest that earn, so if the status quo is mantained and their property rights protected they can get back to their golden days when feudalism was the norm owning literally people and goods.
Dan
Compound interest is the stronger force in the universe like Einstein like to say.
...like Einstein used to say.
ReplyDeleteCelebrating 10 years of Derivatives Deregulation
ReplyDelete"Today marks the tenth anniversary of President Clinton’s signing of the Commodity Futures Modernization Act (CFMA). At passage, the bill was said to establish “legal certainty” for derivatives. In other words, the bill assured bankers that they wouldn’t face any legal consequences in the United States when they manipulated, defrauded, and colluded their way to billions in profits using financial derivatives that no one understood."
Exactly Denise.
ReplyDeleteThe best way to protect themselves is confound the adversaries.
How pitching republicans and democrats against each other but the bottom line is they just own the joint.Politicians can have a less ruthless approach to treat humans and maybe got few things that they cherished like this president and health care (he probably felt too miserable witnassing her mom dying from cancer and fighting with insurers) but have to benefit the elite otherwise is a no no.
So owning the joint makes them get a legal frame to protect their next move with Clinton signing the CFMA.
Then Bush granting them less pressure from a tax stanpoint.
And Obama doing the same.
So politicians can have good intentions but they are actors they don't believe what they said.They have to change it according to the winds as a form of getting the people's pulse but on the other hand all those changing points of view are a good marketing tool that they hone as a way to show the elite that they loose already the fire to fight for the majority of the people as one nation under God.
It helps if the nation can be pinpointed in two big groups and help them to stop thinking, just consuming, and racking up debt.
Dan
So that's why principled people don't go far in politics they don't have the manpower to impose a different view on a country with very few exceptions in some time of crisis.
ReplyDeleteWe can assume that principled people is not necessary because we have the rule of law but in all honesty the law is something that applies sometimes and justice less than that usually when is not convenient to develop a sense of accountability in a nation.
Think of the ciclist in Colorado (I think that Manny brought the article) involved in a hit and run accident left by the side of the road for dead.Was hit by a Wallstreeter.
The judge rule that it wasn't a good idea to incarcerate him because he can afford paying and sustaining the offended (a cosmetic surgeon I think)if he keeps working.
How cute...
So if you have the means just go hitting people through life and then a judge says it is ok.
Is it even legal for a judge to said such a monstruosity, was he disbarred or fired?
Usuallly people assume that exist equal justice under the law, but this however sad it is, shows that if someone likes to read actions in a more pragmatic way said to him/her that the elite is advancing the idea that if someone is supported financially he got a good deal.Don't expect sanctions like going to jail if you have money.
So the point advance is to make money not be an honest person, and everything will be swell.
It shows that equal justice is increasingly becoming just marketing.
Dan
Which means a veering off in the judicial system from the Anglo-Saxon back to Barbaric Law of Lower Germany.
ReplyDeleteAnd why maybe this is starting to happen?
Because the state doesn't have a say in Barbaric Law as long as the offended part is compensated accordingly.
The state is not offended with the crime as long as it is compensated.
Got that?
If gradually start removing the state as a part offended means that the crime is resolved among the parties involved, the state is impotent to intervene.Even don't care is not their function anymore.
Power of the state diminish in that regard and a crime has a price only monetarily.
And I think you guess who is going to benefit in that kind of negotiations (without the help of the state siding with the offended party.
See the trend?
And what happen if the offended party can not pinpoint who the agressor was when he bought some obscure financial derivatives?
The state don't consider something worth to pursue because of the anonimous nature of the financial instrument (meaning no person behind the financial instrument will be punished) and this only if it can accurately be determined who the originator corporation is (which are going to enjoy rights like human beings (if the Supreme Court is in the mood).
And for doing all of that without the DA office help lawyers will need to be paid to initiate all of that.
So yes removing accountability from humans and shifting it to a maze of entangled and intertwined corporations means that the worst case scenario for the elite is that is going to cost just some money any kind of fraud and only if they got caught with the smoking gun.
Exciting future.
Dan
Gee, what a surprise.
ReplyDeleteFed moves to gut Predatory Lending Regulations
"The regulation would severely limit a practice called "rescission," used to strike down demonstrably-illegal or fraudulent loan contracts and void a bank's ill-gotten gains from such predatory lending practices. When a mortgage borrower wins a rescission case in court, the bank loses the right to foreclose, and has to give up all profits from interest and fees on the loan. The borrower still has to repay the principal -- the original amount of money extended by the bank -- but can't be kicked out of the house.
Under the Fed's new proposal, however, borrowers would be required to pay off the balance of the loan before the bank loses its right to foreclose -- that means borrowers could still lose their homes, even in cases where banks have broken the law."
So banks can break the law and still foreclose on a house.
When are we going to stop the criminals that run this country?
"I view this as nothing less than a criminal ploy to shove hard working Americans out of their homes and onto the streets," wrote Ann Capotosto in an undated comment letter. "It is immoral and must be stopped."
ReplyDelete"Think of mankind for once, please," requested Larissa Cavanaugh in a Dec. 4 letter.
"Have you lost your minds?" inquired Beth Findsen in another letter from Dec. 4. "In the depths of an unprecedented catastrophe for the middle class, related to the predatory loans and their rapacious securitization by the financial industry, resulting in millions of middle class Americans losing all of their wealth and their homes, you want to loosen TILA? Are you tone deaf? Have you lost your humanity entirely?"
A Fed representative did not immediately respond to a request for comment.
Just finished reading Sorkin's book "Too big to fail". One of the most interesting tidbits is in the afterword section. He states that Goldman Sachs made a record profit in 2009 of $13.4 billion, and paid out bonuses of $16.2 billion. So does that go on the books as a net loss for the year of $2.8 billion?
ReplyDeleteNew stuff from Matt Taibbi, talking about the Vampire Squid:
ReplyDeleteGoldman's stinky Facebook Deal
New profile picture, we have an yellow/orange cardinal in our yard this winter.
ReplyDeleteYou have to click on the profile picture to really see it well.
ReplyDeleteExtremism and stupidity!
ReplyDelete"Gaurd guns down Pakistan Punjab Governor" http://www.tribuneindia.com/2011/20110105/main.htm
"An outspoken and enlightned person, Taseer had become a target of religious extremists...After he condemned the death sentence awarded to a Christian woman named Aasia Bibi on the charges of blasphemy against Prophet Mohammed. He visited her in jail and promised to recommend to the President to pardon her. Taseer often used twitter to express his opinion and had tweetedd some days ago that he would continue to speak out against the blasphemy law despite backlash from hardliners and religious extremists".
He was educated in the west, his father a famous writer and ateacher and brother-in-law, the great poet - Faz Ahmed Faz.
Extremist views fanned by money coming from Saudi Arabia and U.S. aid going to Pakistan is used against the west.
Saudis are two-faced. Everyone has ambition to rule the world! PBS's Frontline show had several documentaries on the issue. Where else the Talibans get their ammunition?
Sad day for moderates! Scarry for Indians.
ICan
Wow Denise! Interesting looking site and concept!
ReplyDelete@Manny,
ReplyDeleteI am sure that there are connections that few of those people want known.
@greg,
ReplyDeleteGood point. No one knows what to believe anymore.
@Denise: What a brilliant concept and it pretty much defines the term "elites" for me. The interconnectedness of them seals the deal that it's real (not that it's any big shock to any sane, thinking person). I wonder if our little visitor from the other day might agree or care to pose a counterargument? Probably not.
ReplyDeleteI wonder how long it will be before the powers that be hunt these site owners down with some trumped up fake charge similar to Assange?
Good one from Marshall Auerback over at NC:
ReplyDeletehttp://www.nakedcapitalism.com/2011/01/auerback-drinking-the-austerity-kool-aid-in-2011.html
From the post. Sounds a bit like someone I know. Is Marshall reading this blog? ;-)
ReplyDelete"The attacks on public sector unions reflect another flank in this ruthless pincer movement on middle and working class Americans, as this NYTimes article illustrates. It is fascinating to see how the public narrative in the media has gradually shifted over the past year from Wall Street’s sociopathic practices (which were directly responsible for the creation of the crisis) to the alleged greed of public employee unions and their pension benefits, many of which were the product of agreed wage negotiation packages in which unions were receiving these pension benefits in lieu of increased wage benefits.
During 2008, we were told that the government’s hands were tied and that sanctity of contracts had to be honored. This was when the Federal Reserve authorized 100% payouts to the likes of Goldman Sachs on AIG’s credit default swaps (in effect allowing the Fed to act as an extra budgetary vehicle of the Treasury, which is a violation of the Constitution and shows how patently false the Fed’s claims of independence are). But I don’t seem to recall many Wall Street types going on about the sanctity of contracts when agreements with the UAW were reworked to save GM or now when public employee union pension benefits are under attack. The argument seems to be that the states are suffering from a genuine solvency crisis in which everybody has to make sacrifices, including the “greedy” unions. So why should big financial firms, which would otherwise have been toast but for the munificence of the suffering American taxpayer, be any different? If the attacks outlined in the NYTimes piece reflect a broader trend this year, then it has ominous implications for the country as a whole."
@Manny,
ReplyDeleteThat website is like playing 6 degrees of separation, except it is 2 degrees and no separation.