[Peace] Excellent letter to the NG, by David Green

[Karen Aram]

Market reflects wealth inequity

Local wealth manager Paul Ruedi (May 24) asks: “So why isn’t the stock market much lower? Is there a disconnect between economic realities and stock market performance? Economist Dr. Fred Giertz has said the stock market is a leading indicator for the overall economy, and is not interested in what has happened, but only what is going to happen.”

Nevertheless, the stock market has already responded to what has indeed happened. I refer to the CARES Act, by which $1.5 trillion was given to households, small businesses, state/local governments and public health, with $.45 trillion to “big corporations.” But that $.45 trillion can/will be debt-leveraged by 10 times, meaning that $4.5 trillion dollars has been/will be printed for corporations and banks.

This ensured that their coffers would be artificially inflated regardless of profit during the pandemic and regardless of small business failures, family immiseration and death.

Investors, thus reassured, bid back up stock indexes 20 percent from their low on the day of CARES passage (March 23) to May 22. Thus continues four decades of consolidation of stock wealth among the top 10 percent (80 percent), and the top 1 percent (40) percent, and the nonpartisan political subservience that goes with it.

There was a time when modestly rising stock values meant modestly rising general prosperity. Under globalized/financialized neoliberalism, rising stock values mean increased inequality and stagnating wages during the “best” of times. During the pandemic, the hammer is being brought down in even more shameless ways on the working class — wealth manager crassness notwithstanding.

DAVID GREEN

Champaign
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.chambana.net/pipermail/peace/attachments/20200610/f9e40927/attachment.htm>