Dec 23 2011

The calm before the student loan bubble bursts – For-profits make up 9 percent of student enrollment yet produce 27 percent of all private loans. The inevitable pop of the student loan bubble.

The worth of a college degree has now come into question because of the massive student loan bubble.  An education is vital yet the monopoly on knowledge has been turned upside down with readily accessible information through technological changes.  What is odd however is during a time of knowledge access ubiquity you have a field sprouting up of institutions that simply target the unknowing with promises of degrees that yield worthless marketable prospects.  Many for-profit colleges fit in perfectly with the financialization of our nation.  The main goal is to draw in a large unsuspecting audience and saddling millions with unsustainable amounts of debt for a piece of paper that has little worth in regards to career aspirations.  Like the subprime mortgages pushed by lower levels of the financial industry only for quick profits, many of the for-profit colleges have done very similar things to the prestige of a college diploma.  When a list of cats and dogs with college degrees is listed on Wikipedia we know there are serious issues in how some for-profits operate.

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Dec 20 2011

Ultimate money magician in the Federal Reserve and the art of shadow bailouts – The continuing secretive bailout of the $3.5 trillion commercial real estate market.

The Federal Reserve is the ultimate magician in concealing bad bets for the flawed banking system.  Few in the history of the Federal Reserve have called them out on their shadow bailouts but people are starting to wakeup no thanks to the mainstream controlled media.  Think about how insane it is to have a central bank that does not even report to the people of the country it serves and is able to destroy the currency by bailing out bosom buddy bankers at the expense of the population.  How is that even possible?  Since this is the architecture of the system it becomes possible to create mega shadow bailouts like that occurring in the commercial real estate market (CRE). The CRE bailout is largely a sign of what is wrong with our broken financial system.  Sure, with residential real estate the argument can be made that this impacts most American families.  Of course even in that arena it has been a failure for the public but the CRE market is strictly a big money and big banking issue.  The market imploded from being valued at $6.5 trillion a few years ago down to $3.5 trillion today.  Yet why is it the responsibility for average Americans to bailout banks for bad bets on luxury hotels and failed strip malls?

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Dec 12 2011

What is the median household income in the US? A crisis spanning multiple generations and the taboo of household income.

Household income is a taboo topic even though people have a visceral enjoyment of spending their hard earned money.  As we go out and spend during this holiday season many people have absolutely no clue what other family members or neighbors make.  Some would argue that household income is absolutely private and I would agree to a certain point.  The mainstream media is focused on getting people to spend and part with their money.  At this they are highly successful.  Just take a look outside your window and I am certain you will see the artifacts of spending with brand new cars and other shiny lawn toys.  Yet most Americans base the success of others by their purchasing knickknacks and have little clue as to what other households pull in with their income.  This taboo led us into this debt fueled crisis with Americans going into massive debt to keep up with neighbors that never had the income to support their conspicuous consumption.  This article will try to paint a full picture of the income situation across the country.

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Dec 8 2011

8 charts from a brave new banking and economic system – Federal Reserve refutes bailouts yet fails to address inflated questionable assets on their balance sheet. Do you think a $7 billion insurance fund can support the $9.7 trillion in deposits at U.S. banks?

The Federal Reserve has been going back and forth with reporting from Bloomberg regarding the massive bailouts and loans made to the financial sector during the crisis.  What is rather astonishing is the ability to discuss trillions of dollars of loans made to largely irresponsible financial institutions with absolutely no oversight.  Like an angry couple on Maury Povich, only an objective outsider can see how dysfunctional the relationship has become.   All of this happened in the shadows.  What is more astonishing is a large amount of questionable assets that were shifted from bank balance sheets are still sitting comfortably in the balance sheet of the Federal Reserve.  This is not disputed.  Profits at banks are on the rise but it is hard to lose money when you have unlimited access to taxpayer bailouts and the ability to dilute the currency of the nation.  U.S. banks hold $9.7 trillion in deposits with a FDIC Deposit Insurance Fund (DIF) that currently has $7.8 billion.  Do the math on that one.

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