Trump supporters point to the SNP 500 index setting new highs day after day. On August 28, it set a record high of 3500. Yet everyone knows the economy is in its most unpredictable state in decades — if not ever. The smart money should be fleeing to safe bonds.

Stock indexes like the SNP 500 are believed to accurately predict the state of the stock market based on inferences from the average worth of corporations from a sample, which in turn should be a reliable indicator of the state of the economy. But the present index appears to be completely unrelated to the economy. …

Kimberly Latrice Jones, a black author and screenwriter, was out filming anti-racism and anti-police brutality protests when she explained in a you tube video why the focus in all discussions on the rioting in the protests was wrong. We should not focus on the what they are doing, she said, but the why they are doing it:

“Let’s ask ourselves why in this country in 2020, why the financial gap between poor Blacks and the rest of the world is at such a distance that people feel their only hope and only opportunity to get some of the things that we flaunt and flash in front of them all the time is to walk through a broken glass window and get…

Well before the pandemic-crisis struck, analysts were sounding warnings that corporate debt had reached such dangerously high levels that a normal downturn in the business cycle would see many corporate bankruptcies. But the analysts did not count on the rescue by the COVID-19 stimulus package. Now, just as in 2008, the wealthy are going to cream off most of the stimulus package while only a little will trickle down to the workers. The present stimulus funds will be used to pay down that massive but avoidable corporate debt.

Why avoidable? It is the result of predatory practices. I explained how corporations changed their sensible business practice from saving 50% of dividends for corporate use including economic downturns and paying out only the other half in dividends, to stripping out every cent of profit by dividends, in the first article in the series. An even more extractive, predatory practice hides under the term ‘the leveraged buyout’. Equity and hedge funds scour the country to find corporations, large or small, that have net assets and a good cash flow. Then they buy those companies primarily with their own assets. …

The Clinton and Obama policies did nothing to lessen the economic inequality that had been increasing since 1970. Their failure created a desperation in the working class that led to complete disillusionment with the Democrats and faith in an outlier as their savior. The establishment Democrats believe that this-time-will-be-different. Biden will do what Clinton and Obama could not.

At the end of this last April, however, Reuters broke the news that Larry Summers was advising Biden’s campaign.

In Part IV of his award winning documentary inside Job, Charles Ferguson exposed the rampant corruption in the prominent academic economists because of undisclosed conflicts of interest. They receive huge payments from Wall Street, don’t disclose even when Wall Street has paid for an opinion, and pose as neutral academics when they are better seen as well-paid lobbyists for bankers and businesses. …

We are not experiencing one crisis caused by the Corona virus calamity, but four. The other three are hidden under it. They remain largely undetected in the mainstream media. They are about to surface for, as that intrepid investor Warren Buffet once quipped, “It’s only when the tide goes out that we see who has been swimming naked.” I’ll discuss the first in this post.

Not only are they going to cause an increase in the coming economic disaster, as they are main methods of siphoning up the wealth of a nation to the wealth class, their invisibility will be staunchly protected — and they will remain in full effect after the next recovery. …

In the aftermath of the Great Depression observers noted how certain of the wealthy could cash in on a crisis and dubbed them ‘market crash millionaires’. There were only a few then. However, at that time there was a counter balance: the bailout in the 1930s went to the distressed homeowners and continued the progress toward economic equality for workers that had begun slowly in the 1900s.

But by 2020, the super-rich had perfected methods of ensuring that they got the full benefit from every economic crisis. It’s a tale of how both Democrat and Republican administrations supported, and still support, this trend. To understand how the present stimulus package is going to permanently put the economy at risk for the salaried classes, but protect the moneyed classes, I’ll review a pernicious relationship that is never discussed in the media: the role of executive compensation related to buybacks. …

• Executive pay often exceeds 300 times median worker pay
• Each year that gap increases
• The media have been exposing this inequity since the 1990s to absolutely no effect

In his international best-selling book, Capitalism in the 21st Century, French economist Thomas Piketty startled the world with a statistical picture of the grim state of our increasing inequality that would soon return us to pre-World War I levels. The greatest contributor to income inequality: sky-high executive pay. In an interview, Piketty summarized the problem this way:

“In the US, between two-thirds and three-quarters of primary income growth since 1980 has been absorbed by the top 10% income earners, and most of it by the top 1% income earners.” …

• The Head of the New York Fed is a former Goldman Sachs partner
• The Head of Goldman Sachs holding company is a former head of the New York Fed
• The husband of the judge who dismissed Segarra’s whistleblower claim at trial is an advisor to Goldman Sachs
• A Court of Appeal that found nothing wrong with all this is dismissing Segarra’s appeal

After the near-crash of 2008, Congress was aghast. Economists wrote op-ed pieces listing a dozen warning signs of flaws in the financial system, but the New York Fed had not seen a single one. As part of an effort to reform, the Fed commissioned a highly confidential report, written by Columbia professor David Beim, that identified why the regulator failed in the years leading up to the crisis, in short: regulatory capture— a mind-numbing name for the fact that the regulated, here the banks, often control the regulator, here the New York Fed. Beim provided a path forward. He urged the New York Fed to hire expert examiners who were unafraid to speak up and then encourage them to do so. …