While 14 million Americans are unemployed and 1 in 7 Americans are living in poverty, one group isn’t doing too badly.
The top 35 Wall Street financial institutions are set to pay a record $144 billion in compensation and benefits.
Currently, the US has the biggest gap between rich and poor than any other western nations. A new report found the disparity was greater than that of India.
What happened to talks of a crack down on Wall Street? Where is the accountability?
The US government bailouts made the banks bigger, explained Gerald Celente, the director of Trends Research Institute in New York.
“You have 10 banks controlling essentially 80 percent of all the actions. So, the bailouts worked precisely the way they were supposed to do. They made the rich richer and the big bigger,” said Celente.”The trend continues to go in that direction.”
He said that US President Barack Obama’s talk of a crack down on Wall Street was merely empty words, explaining that Obama himself received a large amount of political contributions from Wall Street insiders.
“Washington was hijacked by Wall Street,” he added. “You have a complete disconnect here going on between these white show boys and their $144 billion dollars and the rest of the country.”
Celente argued there has been nothing more atrocious in modern history.
“We’re talking about $144 billion dollars. That would rank number 49 of the GDP of worlds counties of 194 countries,” explained Celente.
However, outrage and anger has not been highly visible across America. Europeans are protesting and taking to the streets, outraged by the failure of their governments.
Celente said the Tea Party movement is beginning a trend and a movement is in place. Americans are waiting for the November midterm election, but when change does not occur they will begin to protest and speak out more, likely in 2011 and 2012.
“The United States is slow on the draw when it comes to protesting,” he said.
Also unlike Europe, the United States is not prosecuting and targeting those in the financial and business sectors responsible for the crisis.
“It’s because of the Media,” said Celente. “It’s the mainstreamed media that keeps sucking up to these greedy pigs that tempers the people down from taking to the streets. Rather than chastising them, they just wink and smile.”
Celente also argued that the Obama administration is full of “losers” and unable to save the economy.
“This thing is going down," he said. “You can’t blame it all on Obama. It was Bush, it was Clinton, it’s the whole system; it’s the sell-out of America. It’s moving all the jobs offshore. This country’s gone from the greatest entrepreneurial empire to one that Mussolini would have called fascism.”
The American people have no problem with others making money, so long as they do so honestly, explained Karl Denninger from The Market Ticker.He said the government’s ability to control the situation following the crisis ended when financial institutions replayed the TARP loans.
“At the root of this is that we did not force these institutions to eat the losses that they caused everybody else in the nation to absorb and so they keep doing the same sort of things they were doing in the 2000 decade and they keep piling up $100 billion dollar compensations packages,” said Denninger.
In Europe, those responsible for the crisis are being criminally prosecuted, but in US people not being held accountable. Denninger noted that while there were no indictments in banking, some bribery changes at the municipal level have been brought against politicians, but not those who handed out the bribes.
Europeans remain outraged, but Americans will not protests because the government keeps handing people money.
“As long as you’re getting paid to sit around and do nothing, that’s what your gona do,” he said.
Denninger said the blame for the crisis falls on the “revolving door between Wall Street and Washington.
“You essentially have a chain of legislative bribery, if you will,” he added.
Denninger also stated that Obama’s excuse of inheriting a broken system has gotten old. “The American people have pretty much had it with that.”
Peter Schiff, the president of Euro Pacific Capital and the author of “How an Economy Grows and Why it Crashes” said the problem is that the US government is “in bed with the major banks”.
“Our economy is not a free market economy, in the United States. We don’t have a real capitalist economy. We have something very different. The government is really bleeding the economy dry as it’s transferring all of this wealth to a lot of these Wall Street Investment banks because of government subsidies, because of government guarantees, because of the Federal Reserve,” said Schiff.
He argued that low taxes and low regulation are needed to prevent major companies from taking advantage of the system. Schiff explained that securities regulation punishes small firms by making it hard to compete, keeping competition down for the big banks that are favored by regulations and legislation pushed through congress by policy makers who receive campaign funding from Wall Street.
“This is not capitalism working. This is socialism. This is fascism,” said Schiff. “You have people like President Obama who pretends to be the champion of the little guy; he is bought and paid for by these special interests.”
The Federal Reserve is flooding the market with cheap money and the average American then suffers because they money is worth less and the price of commodities is on the rise. The government is destroying and chance of growing the economy; they are only growing the government, added Schiff.
“The private sector is collapsing beneath the weight of government,” he said.
The biggest problem is the Federal Reserve, argued Schiff. Americans need to be angrier at the Fed and also at the US court system for allowing the government to get away with operating corruptly and unconstitutionally.