Greed On Main Street as Dangerous as on Wall Street

Brad -

Greed on Main Street is only 1/2 the problem - Ignorance is the other 1/2 of it and the two combined make for a very gullible and easily manipulated average investor and/or citizen. No one bothers to think things through. I was heavily involved in the market until two years ago. I pulled my money out of retirement stocks and financial stocks because a pattern began to emerge called a "bubble". Bubbles do not happen by themselves - they are a manipulation of wealth by those large enough to impact the markets as a whole.

The blueprint is simple - build a bubble and then pop it either by selling massively or letting it self-destruct. As it builds, greed causes the average and unknowing investor to believe he is wealthy and can risk his wealth - by investing in the bubble and thus growing it even faster. Then those with enough shares to manipulate the market begin selling off and selling it down and converting what they have into other sectors. As the bubble collapses fear sets in and the now not so wealthy investors sell of also to protect what they have left - never understanding that they have been raped for their equity in what they had before or during the bubble. As the collapse nears the bottom the large investors begin to buy again at a percentage of what they sold for and thus "double up on their holdings which they have in effect legally stolen from the small investor. Now is where the ignorance plays in - as the prices begin to rise again the average investor reinvests and loses more as it peaks and the big guys cycle it again - and again.

This is very simplistic, but it is the mechanism by which large investors make their money - it is not made by investing in a company and letting your wealth grow with that of the company - it is made by manipulating the greed and ignorance of main st time and time again as they bleed the citizenry dry. When enough panic is created it becomes easy to convince losers that a bailout is needed and in their favor - even though they are paying the bill. Anything to keep making a profit or protect your money! Never mind that the ultimate investor and manipulator has become our own government which is snapping up all the large funds and banks and retirement funds.

Why are they doing this? An enormous bill is about to become due - one which will in the end bankrupt the country. Social Security and Medicare. Much is being made about how those will be in the red within the next decade. Why is that? Because the funds have been used and transferred out of those entitlements to fund excesses of government for over 30 years. Nothing has been paid back, nor can it be without destroying the system as it is. Over the last decade there has been a push to re-direct retirement funds from SS to 401k and other investment funds. That was the setup for the bursting bubble - that loss is being purchased by the government and as the economy bottoms and recovers those assets the government bought at pennies on the dollar will grow and defer the pain. At the same time the onus is being placed on the average citizen to "make a sacrifice" as they cut the amount of SS benefits to those who already paid their dues. It isn't that the money wasn't there - it was - it was taken out and never repaid. Those same baby boomers who are being blamed for bankrupting the SS system actually paid in windfall amouts - amounts which were siphoned off and never repaid. But tell me - have you seen one single outcry? Ignorance reigns - driven by greed.

Jeremiah

Thank you, Jeremiah, for your clear and succinct explanation of stock market manipulation. Although I don't know very much about the stock market, I have been thinking for a while now that this is what is happening. Just the other day I asked "Well, if people are selling, who are they selling to? Someone is going to make a bundle on this and it isn't going to be the American people.

I also appreciate your reminder about the rape of the Social Security system. I did know this, but actually forgot! Perhaps it is time for people to be reminded.

I agree with you, Brad, that this is a conceptual problem as well as a financial one. The Lord never promised to give us all that we want, but all that we need. A large segment of the world's definition of need is totally out of whack. Want to see need? Look at the people of underdeveloped countries who are dying of hunger by the thousands. But I "need" a hi-def TV?????

The above blogs are great - But it has already happened on Main Street to the Have Nots -Not only in the Mortgage crisis - but also in The credit card companies - after they raise interest rates and make payments too high for creditors to make payments and falsify "late charges" and "overlimit" fees -then sell the account for 100 times its value to some loan shark who then threatens the Have Nots -
Where is the honesty here? The Have Nots are the victims of the bigots who live in the huge homes, who visit their spa's, who step on the poor - who eat all the proceeds - Reminds one of the downfall of Rome -

Where is Robin Hood? We need someone to take from the greedy rich and give to the hurting poor.

What's worse with the CCard situation - they are now starting to lower, and in some cases, close your credit. You cannot do anything about. They will just do it.

For those who have no debt - who cares? Well, if they limits or close the account, your fico score goes down 20-30 points. You cannot do anything about it.

However, if you want to buy a home, a car, open a new account - your new, LOWER score could put you in a less desirable light - and You cannot do anything about it. You may be offered a less than stellar interest rate, or other terms you never saw before. You cannot do anything about it.

So the CCard companies who OFFERED to increase limits and WATCHED as people could barely afford minimum payments, will now SMACK it to you by messing with FICO scores.

Honesty? Are you kidding me?

We are in a downfall. And every US citizen should realize we are not #1 (frankly it's not all that appealing anymore...) and it's time to REDEFINE our country for ourselves, to work for ourselves, and to allow another power to take on the worlds' woes. And if we're not the land of prosperity, illegals will find more fertile/prosperous land to steal into and perhaps we'll get a chance to FIX our borders, our economy, our lives. I'm not saying we won't participate, we are, and will likely be for some time, a WORLD power - just not THE world power. We can be Britain or France or Germany or Japan.

Being Jewish, it is particularly galling to see fellow Jews like Richard Fuld take-home 100's of millions of dollars, while many old and defenseless people, well past retirement, have been completely wiped-out. What a deal - or should I say Steal - they got away with! Fuld was able to walk-away with nothing more than a hand-slap from Congress, and yet he STILL gets to keep all of his ill- gotten gains...100's of millions! This money should be immediately seized by the federal government under the RICO statute, a thoroughly corrupt criminal organization that crossed state lines in the process. No matter how anyone spins it, his conduct, as well as his sense of morality, is absolutely shameful and completely criminal. It makes me ashamed to be Jewish, because, no doubt about it, this serves to further inflame anti-Semetic sentiment, not only here in the USA, but around the world. The root cause of this entire situation is nothing less than our entire system of capitalism, which is inherently designed to be economically Darwin-istic, in that it's quite okay for a single man to possess billions of dollars, while children have no health insurance, and people do not enough nutritious food to eat. This is beyond disgraceful, it is criminal. Now I know why my courageous ancestors from Eastern Europe overthrew the Czar. When she was informed that people did not have bread to eat, Marie Antoinette reportedly replied, "Let then eat cake!" To this day, I have a hard time understanding such a complete lack of humanity, whether it be Marie Antoinette or Richard Fuld, and their twisted, perverted sense of criminal entitlement. It is times like these that make inspire the populace to Coup D'Etat. As Mel Brooks exclaimed, "It's good to be the king!" Very true, and very funny, except for one very obvious fact...I don't hear anybody laughing...

the same things go for charging stuff. WE ALL KNOW BETTER, and that we should not charge things we can not afford.

We do.

There was a depression in the 20s.

The market has gone up and down.

There were problems when Carter was in.

There are problems now.

There will be more problem some other day.

You adjust.
Hugs
Laura

Dear Cliff Zimmerman,

Please do not be ashamed to be Jewish because Fuld is Jewish. Fuld should be ashamed for being such a horrible person.

Please do not blame Capitalism. The problem is CandI == Corruption and Incompetence. Candy rots your teeth and CandI rots the economy.

Power tends to corrupt and absolute power tends to corrupt absolutely. Any system can have corruption as any system allows power to accumulate in too few hands.

A few weeks back, there was s simple solution -- insure the mortgages. That would have made all the viral loans sound and there would have been no credit crunch. Bush, Paulson and a host of others knew how to stop the meltdown. instead, they intentionally aggravated the situation and got the American people to give trillions of dollars to the crooks so that they can buy up almost everything for pennies on the dollar. Today you can buy General Motors for 11 cents on the dollar, you can buy The Hartford for 17 cents on the dollar.

The economy did not dive over the brink -- it was pushed.

Why is Bush giving trillions of dollars to his buddies and not a cent to Joe Six Pack? If I have to tell you, then . . . Joe Six pack is really, really stupid. He listen that the moron from Alaska wail about Ayles w/o asking why a few thousands dollars aren't coming his way so he can buy GM, AIG, Hartford, GE, etc?

What people should be doing is voting out of office every member of the House of Representatives who voted for the "bailout" so that after the election we can undo the "bailout" and put all the crooks including Fuld and Paulson in prison.

Scott you have it figured out, we need to vote everyone who voted for the bailout OUT OUT OUT. These are the same people that have controlled congress for the last two years, and now they are pointing their fingers at George Bush and all of the Republicans, but where were they and why was nothing done to prevent this. The Dems who took over control of the house two years ago, have not even acted on any issue and especially the economy. An ounce of prevention is worth a pound of cure.