How Much Control Of The Economy By The Fed And Banks Is Too Much

[FaninAma]

Apparently the assets of the top 5 Fed member banks added to the assets of the Fed Reserve itself equates to about 60 to 65% of the total assets in the country. My question is can the elite bankers use this enormous economic power in a way that is benevolent for the good of the lower and middle classes or will they simply continue to enrich the elite financialists around the world?

[Soonerjeepman]

unfortunately being human nature as it is...I'd say they aren't real worried about us middle and lower class folks. I make $60K...which I use to think was middle class...not so much now. I'd say lower end of MC for sure. Course being divorced, with payments going out $470 a month, plus paying for son's health $165, car $50 a month as well has me really budgeting big time. Not that that isn't bad but I def don't have the freedom to go do what I want whenever I want....nice dinners, movies, car repairs, house repairs, etc. Everything is planned.

I'll just keep plodding along~

[BermudaSooner]

Anytime I see someone wanting to target capital towards something other than the most efficient use of it, I get concerned. When you say "benevolent for the good of the lower and middle classes" do you mean they should use capital in a way that is non-efficient? That makes me think of Barney Frank trying to artificially push up home ownership using the government as backstop---and look where that got us.

The creation of wealth helps all---even if 1 individual initially benefits from the creation of that wealth. If some guy make a billion dollars for himself, what do you think happens to that cash? He buys a Ferrari or remodels his penthouse, or whatever...who builds the Ferraris and who gets paid to remodel the penthouse?

The point is, bankers should shift capital to where it is most useful and efficient as the creation of wealth is what will help low and middle classes. Funding a project this is going to fail simply because there is a direct affect on low income people isn't helpful in the long run....whether it be shifting funds to solar companies bound to fail, or some other project.

Said another way, if the bankers aren't using the funds in the most efficient way, it is effectively a tax on the rest of us as we will have to pay in the form of higher interest rates, for example, to make up for these less than efficient uses of capital.

[BermudaSooner]

unfortunately being human nature as it is...I'd say they aren't real worried about us middle and lower class folks. I make $60K...which I use to think was middle class...not so much now. I'd say lower end of MC for sure. Course being divorced, with payments going out $470 a month, plus paying for son's health $165, car $50 a month as well has me really budgeting big time. Not that that isn't bad but I def don't have the freedom to go do what I want whenever I want....nice dinners, movies, car repairs, house repairs, etc. Everything is planned.

I'll just keep plodding along~

Looks like you fit in the 81st percentile:
http://politicalcalculations.blogspot.com/2012/09/whats-your-income-percentile.html


When you say you don't have "freedom" to do what you want regarding nice dinners and movies and such, I think you misuse the word freedom. Do you think as an American you are owed the right to go to a nice dinner whenever you want?

You have the freedom to choose to spend your money how you want....and you have no claim on someone else to pay for your kid's car or your alimony....those are your choices. If you want more nice dinners, get more education, take a risk that could pay off, do something to earn those dinners.

[Soonerjeepman]

Totally agree with what you said, Anytime I see someone wanting to target capital towards something other than the most efficient use of it, I get concerned. When you say "benevolent for the good of the lower and middle classes" do you mean they should use capital in a way that is non-efficient? That makes me think of Barney Frank trying to artificially push up home ownership using the government as backstop---and look where that got us.

as far as nope on the freedom...not OWED anything. I work hard for my money. I'm NOT for the gov providing any artificial support...more that what is already there (mortgage interest is one I agree with..)
BTW, I have a Masters, have taught for 23 yrs......I'm a teacher so I get what I get. Not complaining...too much. Yes those are my choices.

When I see someone dropping their kid off at my (urban) school driving a Land Rover and their kid is on free/reduced lunch it frustrates me.

My point was I don't think the major players give a rat's a$$ about others..their bottom line is to make money, and if they can do it and it helps the LC and MC then great but not a priority.

[Soonerjeepman]

I'm actually 57% for HOUSEHOLD and 74% for men...just FYI but thanks for the link. Guess I'm right at "middle class".
I did household because I'm that, 2 kids with me at least half the time. Sure I'd be higher if I didn't have kids (expenses)...

[BermudaSooner]

Jeepman,

I hear you on the Land Rover and free lunch--why some people think that is ok. If I were ever on government assistance in any form, I'd feel guilty and want to get off of it as quickly as possible.

I can understand your frustration--we always want more---which I actually think is a very good thing.

[diverdog]

Apparently the assets of the top 5 Fed member banks added to he assets of the Fed Reserve itself equates to about 60 to 65% of the total assets in the country. My question is can the elite bankers use this enormous economic power in a way that is benevolent for the good of the lower and middle classes or will they simply continue to enrich the elite financialists around the world?

The to big to fail banks need to be busted up.

[TheHumanAlphabet]

I'll just keep plodding along~

Which is what the Progressives want and where they want to keep you...

[TheHumanAlphabet]

The to big to fail banks need to be busted up.

Hey, we agree on something!

[FaninAma]

Anytime I see someone wanting to target capital towards something other than the most efficient use of it, I get concerned. When you say "benevolent for the good of the lower and middle classes" do you mean they should use capital in a way that is non-efficient? That makes me think of Barney Frank trying to artificially push up home ownership using the government as backstop---and look where that got us.

The creation of wealth helps all---even if 1 individual initially benefits from the creation of that wealth. If some guy make a billion dollars for himself, what do you think happens to that cash? He buys a Ferrari or remodels his penthouse, or whatever...who builds the Ferraris and who gets paid to remodel the penthouse?

The point is, bankers should shift capital to where it is most useful and efficient as the creation of wealth is what will help low and middle classes. Funding a project this is going to fail simply because there is a direct affect on low income people isn't helpful in the long run....whether it be shifting funds to solar companies bound to fail, or some other project.

Said another way, if the bankers aren't using the funds in the most efficient way, it is effectively a tax on the rest of us as we will have to pay in the form of higher interest rates, for example, to make up for these less than efficient uses of capital.

By "in a benevolent way" I mean in a manner that promtes economic growth and true prosperity not just pumping up stock market bubbles and real estate bubbles and deficit bubbles and government spending bubbles.

I am dubious that the Federal Reserve or any other entity can print their way to true economic prosperity. In fact. I wonder what is holding up the system currently. Once the first doubts about the ability of the US to repay its debts with anything other than newly printed money enter the public domain the game is over.

[RUSH LIMBAUGH is my clone!]

Anytime I see someone wanting to target capital towards something other than the most efficient use of it, I get concerned. When you say "benevolent for the good of the lower and middle classes" do you mean they should use capital in a way that is non-efficient? That makes me think of Barney Frank trying to artificially push up home ownership using the government as backstop---and look where that got us.

...The point is, bankers should shift capital to where it is most useful and efficient as the creation of wealth is what will help low and middle classes. Funding a project this is going to fail simply because there is a direct affect on low income people isn't helpful in the long run....whether it be shifting funds to solar companies bound to fail, or some other project.

Said another way, if the bankers aren't using the funds in the most efficient way, it is effectively a tax on the rest of us as we will have to pay in the form of higher interest rates, for example, to make up for these less than efficient uses of capital.Absolutely. If the bankers weren't required to make those stupid-as*ed subprime mortgages, we wouldn't even be having this sour grapes conversation.

[BermudaSooner]

The to big to fail banks need to be busted up.

Or....how about we practice capitalism and let them fail...

[TheHumanAlphabet]

^^^ This to...

[RUSH LIMBAUGH is my clone!]

Or....how about we practice capitalism and let them fail...Gosh, is that still even possible?

[RUSH LIMBAUGH is my clone!]

IOW, sad that the banks are allowed the "Quantitative Easing", among the the most obvious means of guaranteeing inflation possible. Obviously, such behavior is controlled and/or approved by the Executive Branch. It appears to bother them not in the least. How can we return to normalcy?

[diverdog]

Or....how about we practice capitalism and let them fail...

the fastest way to destroy capitalism would be to let them fail. They need to be busted up because they are a ticking time bomb and their business model is unsustainable.

[diverdog]

IOW, sad that the banks are allowed the "Quantitative Easing", among the the most obvious means of guaranteeing inflation possible. Obviously, such behavior is controlled and/or approved by the Executive Branch. It appears to bother them not in the least. How can we return to normalcy?

where is the inflation?

[Midtowner]

Or....how about we practice capitalism and let them fail...

Because why go down with the ship when we can build life boats and all be just fine?

[FaninAma]

where is the inflation?

Food, energy, medical costs, college tuition. There is a reason why these items were excluded from the CPI. Even a low rate of inflation is honerous when wages and income have been as stagnant as they have been for the past decade.

Anybody who believes the inflation rate is less than 2% is a rube.

[BermudaSooner]

the fastest way to destroy capitalism would be to let them fail. They need to be busted up because they are a ticking time bomb and their business model is unsustainable.

I'm not sure you understand what capitalism is. BTW...to you and Mid...notice how the world came to an end when Lehman went down...no? Me neither...

Diver, I am curious what is it about a large bank's business model that is unsustainable in your mind.

[RUSH LIMBAUGH is my clone!]

We be in a heap of much big trouble, and we have asked for it.

[diverdog]

I'm not sure you understand what capitalism is. BTW...to you and Mid...notice how the world came to an end when Lehman went down...no? Me neither...

Diver, I am curious what is it about a large bank's business model that is unsustainable in your mind.

Read this from my CEO:

http://blog.syracuse.com/opinion/2012/04/robert_wilmers.html