Econintersect: Click Read more >> below graphic to see today’s list.
The top of today’s reading list discusses the exposure presented by underwater HELOCs (home equity lines of credit) …….. and the last article presents analysis that concludes that bankers and communists are aligned in driving up income inequality for individuals while drive it down country-to-country.
- Insight: A new wave of U.S. mortgage trouble threatens (Peter Rudegeair, Reuters) Keith Jurow has been warning about this for years (here, here and here), GEI contributor Larry Doyle highlighted this problem three years ago and the New York Fed warned about this over a year ago..
(Yves Smith, Naked Capitalism) Why does the New York Fed have a “secret” trading floor and a staff of stock analysts?
- The NYT Implies that Not Prosecuting JPMorgan Proves DOJ’s Vigor (William K. Black, New Economic Perspectives) William K. Black contributes to Global Economic Intersection.
- An Open Letter to the FOMC: Recognizing the Valuation Bubble in Equities (John Hussman, Hussman Funds) Hat tip to John O’Donnell. We have previously shown some of the graphs in this article and the article itself, but it is worth considering them all in context one more time.
- Is Bitcoin about to change the world? (Alex Hern, The Guardian)
- Tapering is Tightening or Easing? (David Kotok, The Big Picture)
- Gasoline Volume Sales, Demographics and our Changing Culture (Doug Short, Advisor Perspectives) Doug Short contributes to Global Economic Intersection.
Click on graph for large image at Advisor Perspectives.
- What if There Are No Conventional Price Mechanisms? (Frederic S. Lee, New Economic Perspectives)
- The Life Choices of Wealthy Men, Part Four (Elliott Morss, Morss Global Finance) Elliott Morss contributes to Global Economic Intersection. This part of the series examines what parental expectations do the the lives of their children.
- The two great vested interests: bankers and communists (Alan Kohler, Business Spectator)
Inequality, I would argue, is not caused by capitalism but by its lapses – that is, by vested interests that distort the system for their own purposes and capture more than their share. Inequality is thus caused by a failure of regulation and competition, not by the existence of competition.
In recent weeks I have been developing an idea – that is, trying it out in speeches – that inequality results when elite vested interests succeed in distorting society to their own ends, and the two great vested interests of the modern world are American bankers and the Chinese Communist Party.
In the following graph total = global (as one unit), between = average between countries, and within is the average within the individual countries. The latter category (within) is dominated by China and U.S. data.
From Paolo Liberti, The World Distribution of Income and its Inequality, 1970-2009.
