THE BANKSTERS’ BIG CON-GAME

 

Would you buy a ten year old car for more than it cost new?

 

Why do you pay more than original purchase price for a ten year old house?

 

You take on a lower quality infrastructure, liable to have problems with plumbing, electrical, roofing, etc.,  that is not as good as a new house.

WHY?

Because the bank-paid appraiser is paid more to ratchet up the sales price to get you into greater debt.  Why compare it with the other houses in the area?  Because it’s a good way to pump up prices that are based on other artificially valued property.  They don’t have to justify better or lesser valued features of neighborhoods, or of community comparisons.

 

Do any of you recall when you bought a car by taking over the payments from the owner?  Years ago, houses could be bought that way.  What happened to that?

 

Have you ever calculated the total cost of your home and its annual maintenance expenses, including interest?

 

You are paying 3 times the cost of the house for just the money to finance it.  That’s right!  The builder buys the land and puts up the labor and materials for the house and sells it for X dollars--the sales price.  The Banksters puts up the money for the mortgage, and sells it for three times the sales price of the house—3X your house’s cost. 

Did the Bankster do more than create an electronic entry to “build” the money?

What were the Bankster’s labor and materials invested to create the money?

Don’t be fooled !  He is not lending out depositors’ money.  The Bankster can create five dollars electronically for every depositor dollar held in reserve.

 

Buyers end up in Debt and pay too much of their take home pay for the Money Cost—Interest— and much less for the house’s real value.  Most of the payment goes for Interest—Cost of the Money—not Principal.  40 years ago, the qualifying income was 25% of your weekly Take-Home pay; ie. If you made $ 3000 a month, after taxes your approximate Take-Home pay was $700; you could not qualify for any FHA or VA financing on a house payment of more than that.  Today, the Banksters have edge that up to 33% of your monthly Gross Pay; ie. At a salary of $3000/mo. that would be $1000 a month for the mortgage. 

 

50 years ago, you got 4% on Passbook Savings.  50 years ago, we had no credit cards or debit cards.   The Banksters got along paying 4% on depositors’ passbook savings accounts.  Time deposits—CD’s--paid even more.   Today, you are lucky to get 2%.  Invest $5000 and at 2% the bank pays you $100.00 a year.  Your $5000 in reserves is used to electronically create $25,000 that he can loan as mortgage money.  As mortgage money at 4%, he earns $1000 a year for money he is paying $100/yr  for your money market deposit.  Used as a credit card loan, he makes 15% or more per year or $3750/yr from a credit card holder.  Not a bad exchange: $100/yr for your money that he loans at $3750 per year.

 

Now, the Banksters have fees and bank charges for services that used to require workers to handle.  Now, we pay for services that no longer need bank employees to handle.  Phones calls are handled by machines, as are most cash withdrawals for which you must use ATM’s.  They eliminated employee costs for such, but charge fees if you are not at your home bank.  That used to be a free customer service, too.  They got rid of the workers handling checks and pass those tasks onto the customer.  Do you get cancelled checks returned from your bank?  The Banksters took that away and fired the check handlers and saved mailing costs, too.

 

Historically, the Banksters always gain while the people lose.

 

In the early 1800’s, the Economic System pushed many workers into debt to the employer—by having them living in Company Houses, buying at the Company Store, and so on.  This was an upgrade to the labor system of the 1600’s, the Indentured Servants Program, when people put themselves into debt for years to purchase Passage to the New World.

 

Today, in America’s Economic System, most people are wooed by banks to use “CREDIT”--a more neutral, harmless-sounding term than DEBT.  Workers have lost their freedom gradually, as they take on debt and end up working 40 to 50% of their working-life paying Interest—the Banksters’ rigged Cost of Money.

 

The Banksters have created the fraudulent idea of the “American Dream”—Home-Ownership; just another clever way to sell Credit—Debt.  The Con Game called the “Ownership Society” has resulted in the 2007-2010 Crash called, “The Great Recession”.

Laws enacted and paid for by Lobbyists, supposed to prevent a recurrence of such, are crafted to re-enable the Banksters’ corrupt practices that have conned people into more Debt since the mid-1990’s.  This is the “Sub-Prime Loan Scam” all over again. 

 

The lobbying power of both quasi-government firms, Fannie Mae and Freddie Mac, facilitated the Sub Prime Bubble that burst in 2007-2008.

See: “All the Devils are Here”, McLean & Nocera, 2010, The Penquin Group, London , England, ISBN 978-59184-363-4, pp. 40-50. 

Editor’s Notes: This book is hard to find, so the foregoing will help you order it.  The book about the Savings & Loan debacle of the 1990’s was also hard to find.   Is that a coincidence?

 

Indentured servitude--physical slavery--has been replaced with Economic Slavery called “Credit”, which is the slickers’ name for “Consumer Debt.” 

 

For some years, consumers could get income tax deductions for all consumer debt. 

Then the Plutocrats’ Congress eliminated the deduction for all credit purchase except residential home purchases.  At this writing there is talk of the Congress taking that tax deduction away also; another Lobbyists for Banksters’ empowerment escapade.

 

The legally-corrupt Congress pass whatever laws the Banksters’ and Special Interests’ Lobbyists propose.  Campaign Election Financing is fueled by Money.  People’s votes are nullified by Big Money handed out by Lobbyists.  Smart People see this is as Legalized Corruption.

 

Since the end of the 1970’s, the Standard of Living of the average American has drastically degraded.  In 2010, the average worker is making less in real dollars than in the 1960’s.

 

The USA is no longer an Egalitarian Economy—where everyone, who is created equal, has an equal opportunity for increasing his Net Worth.  In real terms, the charts below show that the USA is no longer an Egalitarian Economy.  It is now a Plutonomy with a Government run by Plutocrats.

 

On the Figure 4 chart below is shown the top 1%’s Income Share, in years from ‘81 thru ’02, that has outpaced the rest of America;

 

 

On the chart’s horizontal grade, years ‘60 thru ‘81, the Top One Percent was doing well.  Their share of USA’s income was over 8%.  One percent of the people earned eight percent of the national income.  Can you recall who was running the Government starting in 1981?  What happened to make the Upper Class Income increase from 8% to over 15% after the 1980’s?

 

 

 

 

The Figure 1 chart, below, shows how well the upper classes have done compared to the rest of us:

Charts are from the Plutonomy Report at: http://www.calneva.com/media/index.htm

 

Since 2000 was the peak year in equities, and the top 1% of households have a lot more equities in their net worth than the rest of the population, who tend to have more real estate, these data might exaggerate the U.S. plutonomy a wee bit.

 

Was the U.S. always a plutonomy - powered by the wealthy, that aggrandized larger chunks of the economy to themselves?

 

Not really. For those interested in the details, we recommend “Wealth and Democracy: A Political History of the American Rich” by Kevin Phillips, Broadway Books, 2002; (Kevin Phillips was one of President Nixon’s Economic Advisers, circa the 1970’s.)