Economic Policies Have Led Us To The Great Divide And Will Lead Us To The Great Collapse

May 16, 2014, by Ken Jorgustin

the-great-divide

When slow and steady change happens in your life, slowly but surely, you don’t really notice the aggregate of the change so much while you adapt to it over the span of time.

This is why when we reflect back on how it used to be (“back in the day”), it often seems so radically different than it is today. When we look back, we see some of the huge changes that have taken place – and we wonder how and why it has changed so much. The thing is, much of the change is disguised in increments, be it good or bad.

One such change has been taking place right under our noses, and I call it,

“The Great Divide”


 
There is a great divide that has been developing in this country, and although it has always existed to an extent throughout time – it has magnified dramatically since the FED bailouts and new economic policies since 2008.

That is, the divide between the very rich, and the rest of us.

No, not the divide between the rich and the poor, but the divide between the very upper middle class (on up to the very wealthy) – and the rest – including the rapidly disappearing middle class.

No, this (article) has nothing to do with fanning the flames of “class warfare” between the have’s and the have-not’s. There will always be a gap – it’s just the way the spread works… and is logical when you really think about it – along with the typical reasons for it.

HOWEVER,

The reason for this EXAGGERATION of disparity are the present economic policies of the central bankers who have been (and still are) printing (digitally) an unbelievable amount of money every day, every month…

You all know this – it has been well known for years – the expanding money supply, the ballooning debt of our nation and the world’s nations.

When this amount of money is printed, it has to go somewhere.
It doesn’t just sit there! – with no effects.

 
A-lot of it goes into the financial markets – stocks, bonds, commodities, etc.

It also goes to extravagant luxuries of the rich – multimillion dollar estates, yachts, and any and all other opulence of the wealthy, etc.

The eventual result of all this (money printing) is the ‘price’ of the things where the money flows (e.g. the stock market) goes up (despite the underlying realities of the ‘real’ economy),

And asset classes go up – all while our food, energy, and retail prices creep higher and higher while our government tells us inflation is tame ‘and prices really aren’t getting any higher’ (due to their cloaking and manipulation of the numbers and how they are reported)…

A steady creep. Do you notice it?

 
The results of higher prices do not affect the wealthy who spend a very small percentage of their income on living expenses.

But for the rest (and the majority of people) who spend a very high percentage of their income on living expenses (rent-mortgage-food-energy-autos-health-insurance-bills-loans-taxes-etc.,) a creeping increase of those costs are consuming the remaining few percent of surplus income (if any) just to stay afloat.

 
Look at it this way — how much disposable income is left for you at the end of each week or month? 10%? Less?

If you earn, say, $50K a year and your weekly take-home pay is say, $800/wk. ($3500/mo.), how much do you have left over after your rent (mortgage), groceries, utilities, insurances, property taxes, fuel, loans, etc.? Do you have more than $300 or $400 left in your pocket? For most of the middle class, probably not so much…

For most, if their margin is say, 10%, (it’s costing 90% of their income to ‘live’), then ANY increases in these living expenses will have a very big impact on their lives!

On the other hand, for those who are spending a small percentage of their income on living expenses, they hardly are impacted at all by increases in their cost of living.

 
The thing is, the economic policies of the FED, the federal government, and the central bankers have been steadily widening the gap between the wealthy and the rest (the middle class).

And the disparity has become so great, that it is going to lead to social upheaval.

The reality is that proportionally there are very few of ‘them’ and there are LOTS of the rest. When ‘the rest’ reach their limit, there will be ‘unrest’. Count on it.

The great divide.

The current policies have so twisted economic reality, that it seems absurd that it continues. But it does. Debts at all-time (staggering) highs. Price-to-Earnings ratios (PE) and stock markets at all-time highs. The exuberance of blind faith in a never ending stream of dollars and profits flowing from the spigots. The uber-rich are the recipients of the stream of funny-money while the middle class are the recipients of a steady tightening of their budgets – unable to print their own funny money…

One day historians may look back on the years of ‘today’ and wonder why the vast majority of the people did not see it coming (the collapse). The signs were everywhere. How could they not have seen it or changed their ways?