Amid Warnings Of Financial Crash, Fed Chair Promotes Illusions

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By Nick Beams for World Socialist Web Site. Wyoming (August 26, 2017) – Yesterday’s speech by Federal Reserve chairwoman Janet Yellen to the conclave of central bankers at Jackson Hole, Wyoming recalled events at the gathering 12 years ago. At that meeting, the growing signs of the devastating financial crisis that was to strike in 2008 were completely ignored. That was likewise the situation at this year’s meeting, held under conditions where the surge in stock markets is bringing warnings of a major collapse. The 2005 meeting was organised as a celebration of the achievements of the “Maestro,” Fed chief Alan Greenspan, whose policies, it was claimed, had brought a new era of prosperity to the global economy.

Workers Celebrate 20 Years Of Shared Bread And Ownership

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By Misty Dawn Spicer-Sitzes for Shareable. Workers in California are taking economic change into their own hands. The Arizmendi Association of Cooperatives is one of the shining examples of how shared ownership empowers workers and builds community. For the past 20 years, the association, comprised of six bakeries, has been innovating the way business is done. What’s its recipe for success? It turns out that it is more than just tasty treats: Each bakery is democratically-owned and governed by its workers. A worker-owned cooperative is a business in which each employee owns one equal part of the company. They share the profits in the good times, and they share the burdens in the hard times. Worker co-ops can have anywhere from three members to thousands, and they have varying pay scales and job structures.

An Inequality Double-Whammy

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By Sam Pizzigati for Inequality – Inequality doesn’t cause every problem in our world today. Inequality just makes every problem worse. Big problems especially. Like recessions. We’ve known for some time that recessions — and depressions — become much more likely when wealth starts excessively concentrating in the pockets of the already rich. Now we have important new research that adds to this story.

Is The US Economy Heading For Recession?

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By Jack Rasmus for Telesur. This past week the U.S. government announced the contry’s economy rose in the January-March 2016 at a mere 0.5 percent annual growth rate. Since the U.S., unlike other countries, estimates its GDP based on annual rates, that means for the first quarter 2016 the U.S. economy grew by barely 0.1 percent over the previous quarter in late 2015. Growth this slow indicates the US economy may have “slipped into ‘stall speed’, that is, growth so weak that the economy loses enough momentum and slides into recession”, according to economists at JPMorgan Chase. Has the U.S. economy therefore come to a halt the past three months? If so, what are the consequences for a global economy already progressively slowing? What will an apparently stagnating US economy mean for Japan, already experiencing its fifth recession since 2008?

2016 Crash Begins – This Time Isn’t Different

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By Tyler Durden for Zero Hedge. The reckless herd has been in control for the last few years, but their recklessness is going to get them slaughtered. Corporate profits are plunging. Labor participation continues to fall. A global recession is in progress. The strong U.S. dollar is crushing exports and profits of international corporations. Real household income remains stagnant, while healthcare, rent, home prices, education, and a myriad of other daily living expenses relentlessly rises. The world is a powder keg, with tensions rising ever higher in the Middle East, Ukraine, Europe, and China. The lessons of history scream for caution at this moment in time, not recklessness. 2016 will be a year of reckoning for the reckless herd.

The Collapse Of Black Wealth

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How the recession turned owners into renters and obliterated black American wealth. In 2005, three years before the Great Recession, the median black household had a net worth of $12,124. Yes, this was far behind the median white household—which had a net worth of $134,992—but it was a huge improvement from previous decades, in which housing discrimination made wealth accumulation difficult (if not impossible) for the large majority of African-American families. By the official end of the recession in 2009, median household net worth for blacks had fallen to $5,677—a generation’s worth of hard work and progress wiped out. (The number for whites, by comparison, was $113,149.) Overall, from 2007 to 2010, wealth for blacks declined by an average of 31 percent, home equity by an average of 28 percent, and retirement savings by an average of 35 percent. By contrast, whites lost 11 percent in wealth, lost 24 percent in home equity, and gained 9 percent in retirement savings. According to a 2013 report by researchers at Brandeis University, “half the collective wealth of African-American families was stripped away during the Great Recession.” It was a startling retrenchment, creating the largest wealth, income, and employment gaps since the 1990s. And, if a new study from researchers at Cornell University and Rice University is any indication, these gaps are deep, persistent, and difficult to eradicate.

Latest Jobs And Housing Reports Show Americans Are Struggling More Than Ever

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The latest nationwide jobs and housing statistics released this week suggest that America is no longer a country where—for most people—the future is going to be better than the past. The percentage of people in most age and education levels in jobs compared to 2008 is down. The number of people holding multiple jobs is up. Average hourly wages have barely grown, compared to 2008. The number of people who are willing to leave their job for a new one is down. All of those trends are in the latest report from the U.S. Bureau of Labor Statistics (BLS)—and there are even more depressing economic signs. More than one-third of Americans who bought homes are trapped by that debt, according to the real estate data website Zillow.com. Some 9.7 million homes, which is 18.8 percent of U.S. homeowners, owe more than their homes are worth. In another 10 million homes, the buyer’s equity is below 20 percent, which means they can’t sell and buy another home unless they find another way to cover all the transaction costs. Taken together, the BLS report on the working class and the Zillow report on the middle class suggest that the country, despite virtually every politican’s assertion to the contrary, does not have its best days ahead. It may be that America’s best days—when the promise of hard work and playing by the rules led to economic security—is a thing of the past.

The Slowing Global Economy – Prolonged Stagnation Without The Crash

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QEs, massive liquidity injections by central banks, token fiscal stimulus policies followed soon by austerity fiscal stimulus withdrawals represent the recovery policy ‘mix’ for the US since 2008. In similar form, albeit with different emphases, the same monetary and fiscal policies have been adopted by other main capitalist sectors of the global economy. Those economies, from the Eurozone, UK, to Japan and elsewhere are also experiencing a ‘stop-go’ economic recovery trajectory. The outcome has been more or less the same everywhere: a bailing out of the banks, an acceleration of investors income and corporate profits, a shift toward speculative financial investment, growing income inequality, declining relative real investment, inability to generate full time employment and wages, declining real disposable incomes for median family households, stalling consumption, and a sub-par historical, ‘stop-go’ economic recovery.