Page 1

Americans Live On A Statistical Reservation Max Keiser May 8, 2014 America’s Bureau of Labor Statistics reports inflation in the US running at 1.5 percent. This is dangerous nonsense. The 1.5 percent number depends on a misrepresentation of a key component: food. And it is this statistical hocus-pocus that is at the heart of wealth and income gaps (and revolutionary tendencies) in the US and around the world. What percentage of your discretionary income is spent on food? If the answer is 40 percent or more then you are living on one of America’s new statistically engineered reservations (i.e. open air prisons) or thinking about revolution, as we saw in Egypt and now Ukraine. How does this statistical inflation mirage work? Inflation numbers are presented by the government and the MSM in a way that implies homogeneity across all income and wealth brackets, but this is an illusion designed to mask pernicious financial engineering implemented to channel vast sums of money away from the many and into the pockets of a few financial engineers and bankers at the remaining TBTF (Too Big To Fail) banks on Wall St. and the City of London. “Financial engineering” is a highfalutin’ term, like calling garbage men “waste disposal engineers.” It is a term meant to deflect attention away from what are essentially governmentsanctioned lies. Instead of reporting on the actual price movements of food in a representational way that indicate the true costs for the average person, the government’s inflation “index” is rigged so that –

and this is key – any accurate reading of food prices is excluded and therefore economic policies are conveniently flawed in ways that favor one class of Americans over another. Since food is the one essentially component in any household budget – by rigging the food price number in the index, by understating food’s true costs, or simply omitting food costs from the index – government statisticians can claim that the overall trend in inflation is 1.5 percent, even though food prices are rising by close to 10 percent, and the overall inflation experienced by the average consumer is near 8 percent. Misstating food inflation numbers helps the top 1 percent, since their monthly cost for food, as a percentage of their overall household budget, is less than 2 percent, so the true 10 percent rise in food cost inflation to them is negligible; whereas for the bottom 99 percent (and it gets worse the further down the socio-economic ladder you go), the same 10 percent food cost increase means a substantial loss in purchasing power and loss of wealth. And when you get down to the poorest of the poor, loss of life. Rigging food prices by not including them in the official inflation index is a subtle form of gerrymandering at best. A closer examination of this government-backed charade looks more like statistical apartheid. The middle class and the poor are being squeezed out by rising rood costs that are not included in the government’s calculations and since the government can’t figure out where to put all these newly poor they create they imprison them (while the US represents about 5 percent of the world’s population, it houses around 25 percent of the world’s prisoners), or keep them in trailer park ghettos (the fastest growing real estate segment by private equity investors in America). The added benefit for the 1 percent top-tier class of rigging inflation is to give them rhetorical (read: propaganda) cover to claim the economy is at risk of “deflation” and therefore interest rates should stay at record low rates (recently hitting 300-year lows in the UK and 240-year lows in America). Low interest rates (controlled by central banks) lower the cost of borrowing for the purpose of making speculation cheaper and driving up the prices of so-called “assets” that comprise the bulk of the 1 percent’s wealth. (And when speculative bets go wrong, the same government that misstates the inflation number and controls the central banks, bail out the speculators too.) Pretending food price inflation doesn’t exist keeps the 99 percent poor and the 1 percent rich. But be careful. As we’ve seen recently, and throughout history (with the most famous example being France in 1889), when food prices eat into 40 percent of household budgets, the population revolts.

Federal Reserve Chairman Janet Yellen: Deficits Will Rise to Unsustainable Levels Terrence P. Jeffrey CNS May 8, 2014 Federal Reserve Chairman Janet Yellen, referencing the Congressional Budget Office's long-term budget projections, told the Joint Economic Committee of Congress today that under current policies the federal government’s deficits “will rise to unsustainable levels.” In the 10-year budget projections it released in April, the CBO estimated that the federal government will run $7.618 trillion in deficits from 2015 through 2024. At the same time, the CBO projected that the federal government’s debt held by the public would rise from $11.983 trillion at the end of fiscal 2013 to $20.947 trillion by the end of 2024. 2013 to $20.947 trillion by the end of 2024.

The debt held by the public is the part of the U.S. government debt that is not held by the federal government itself. It primarily consists of marketable Treasury securities, including bills, notes and bonds. It does not include what the government calls “intragovernmental debt," which is the money the Treasury has borrowed out of the Social Security Trust Fund and other government trust funds to pay current expenses. The total debt of the federal government at the end of fiscal 2013--including both the debt held by the public and the intragovernmental debt--was $16.719 trillion. The CBO estimates that by 2024, the total debt of the federal government will be $27.159 trillion—of which $20.947 trillion will be debt held by the public. If that projection holds up, the federal debt held by the public in 2024 would be more than four times the $5.035 trillion federal debt held by the public at the end of 2007. Yellen made her statement about unsustainable deficits when she was questioned by Sen. Dan Coats (R.-Ind.). Coats remarked that businessmen in Indiana told him that their businesses were underperforming at this time because of the uncertainty they felt as result of federal taxation and regulatory policies. “What recommendations would you give to us in terms of dealing with this uncertainty that is basically causing a lot of these businesses to underperform?” Coats asked. “So, I agree with you,” said Yellen. “My own discussions with businesses, I hear exactly the same things that you are citing: concerns with regulations, about taxation, about uncertainty about fiscal policy. “I guess one recommendation that I would give you is that long-term budget deficits, we can see in, for example, CBO’s very long-term projections, that they remain,” said Yellen. “There is more work to do

to put fiscal policy on a sustainable course. That progress has been made over the last several years, in bringing down deficits in the short term, but that a combination of demographics, the structure of entitlement programs, and historic trends in health-care costs, we can see that over the long-term deficits will rise to unsustainable levels relative to the economy. “And," she said, "putting in place a package of reforms—ones, I know these are very controversial matters--but that would probably help confidence.” Coats later said to Yellen: “You join a long list of very responsible Americans who have the experience and the expertise to give us some warnings about what may happen in the future and our inability to act over the last several years now in addressing these major problems that are going to have significant consequences on the economy of this country and on future generations. “I don’t know what it is going to take for us to summon the will to do what we all know that we need to do,” said Coats. “But I appreciate your adding your name to that long list saying you have a responsibility up here and you’re not fulfilling that responsibility.” According to the CBO, “mandatory” federal spending will increase approximately 58 percent over the next ten years, rising from $2.32 trillion in 2015 to $3.664 trillion in 2024. Over that decade, total federal “mandatory” spending will be $29.737 trillion. That will include $8.25 trillion on Medicare, $4.55 trillion on Medicaid, $9.9 trillion on Social Security, $1.78 trillion on disability insurance, and $728 billion on food stamps. Fed Chair: ‘Deficits Will Rise to Unsustainable Levels’ VIDEO BELOW Zeitgeist Addendum The Scam of The U.S. Banking System VIDEO BELOW Creature From Jekyll Island A Second Look at the Federal Reserve VIDEO BELOW Fiat Empire: Why The Federal Reserve Violates The U.S. Constitution VIDEO BELOW Money, Banking and the Federal Reserve VIDEO BELOW The Money Masters a History of Money VIDEO BELOW The Secret of Oz VIDEO BELOW


Americans Live On A Statistical Reservation  

America’s Bureau of Labor Statistics reports inflation in the US running at 1.5 percent.

Read more
Read more
Similar to
Popular now
Just for you