“Our commercial policy should hold an equal and impartial hand; neither seeking nor granting exclusive favors or preferences; consulting the natural course of things; diffusing and diversifying by gentle means the streams of commerce, but forcing nothing.” — George Washington.
With the election of President Donald Trump, the ongoing battle of Wall Street versus Main Street — the people who make money controlling other people’s money versus those who produce, buy and sell tangible goods and services — has intensified.
In a more ideal world, the two would work together for mutual benefit; but, alas, we do not live in that more ideal world.
Those who are not invested in stocks either personally or via their pension/retirement plans, or are not business owners, may be wondering why they should care.
Like it or not, what happens on Wall Street historically has had a major impact on Main Street.
It is in the average American’s best interest to, at the very least, be cognizant of same and to take appropriate measures for the sake of themselves and their families.
As U.S. employment has reached record high numbers across almost all demographics, and consumer and small business confidence has climbed, the mandarins of Wall Street have become increasingly worried.
They seem to fear increased prosperity in the middle and working classes. It is also evident that since many of them are multinational corporations, what is good for ordinary Americans does not always bode well for their business plans.
Wall Street and its allies in both the Democrat and Establican wings of the Establicrat Party, the Misleadia Media, and other Leftist apparatchiks have been hard at work fighting against any Trump administration actions and policies that shift the past imbalance of power away from Wall Street power brokers back towards Main Street businesses and workers.
In the case of Wall Street and the Establishment in general, at stake is the ability of a relatively few people and institutions to exercise power — specifically the power to accrue money and more power — over the wealth and freedom of others.
In the minds of many, the stock markets have come to represent the economic health of a given nation,, hence the not-altogether-true perception that what is good for Wall Street is good for America. In fact, many of the Big Banks go so far as to finance tyranny around the globe as they prop up evil governments and immoral businesses (e.g., Venezuela).
Though economic factors certainly influence financial markets, at any given point in time, publicly traded financial markets are not an accurate reflection of the economic health of the national economy — or even of the companies, commodities or other assets represented, for that matter.
More importantly, Wall Street malfeasance has a long history of destroying real wealth and real lives of people not directly invested in the public or private financial markets.
Real assets rarely have significant fluctuations in value, much less variation both up and down over the course of mere seconds.
Currently, volatility in financial market assets is typically a function of the actions of traders and trading algorithms.
In fact, in the case of public financial markets, high frequency algorithmic trading performed by major financial institutions’ automated programs currently accounts for the vast majority of overall trading volume.
In 2017, JP Morgan estimated than only 10 percent of trading volume was based on “fundamental discretionary traders” (cnbc.com), i.e., real people making investment decisions based on the real value of the assets traded.
Given the sheer volume of funds controlled by a relatively small number of institutions, market manipulation and price volatility — intended or incidental — has become the norm, often with little correlation to the real value of the underlying assets.
Even though current financial markets may or may not provide accurate asset valuation, they do have a very real impact on investor and consumer confidence, as well as stored wealth.
Trump understands this dynamic, hence, his references to the health of the markets.
He might be better served, however, educating the public to both the machinations of those behind the curtains and the health of the Main Street economy that is not well represented in the Wall Street-dominated financial markets.
Due in no small part to the onerous regulations imposed by previous congresses and administrations — which leads both to large companies getting bigger and private companies electing to stay private — the number of publicly traded companies has dramatically declined in recent years.
The approximately 3,600 firms listed on U.S. stock exchanges at the end of 2017 is less than half the number listed in 1997 (Bloomberg.com, “Where Have All the Public Companies Gone?”).
According to data published by the Small Business Administration, in 2018 there were 30.2 million small businesses (99.9 percent of all U.S. businesses) employing 58.9 million (47.5 percent) persons (sba.gov, “2018 Small Business Profile”).
These small businesses also tend to be the incubators and engines driving innovation and community economic stability across our nation.
One of the challenges for small businesses is that big businesses have the proclivity to “lobby” (aka bribe) politicians and bureaucrats to implement unfair regulations and taxes that are barriers to entry and provide competitive disadvantages to companies that do not have the resources to hire the army of lawyers, accountants and bureaucrats required to be “in compliance.”
Bear in mind that the vast majority of these government-invoked hurdles have little to nothing to do with providing a better product for consumers, work environment for employees or profit for stakeholders.
They primarily serve as mechanisms to enrich both the politicians and the crony capitalists.
Though not everyone associated with Wall Street is an advocate of corruption, most of the big players adhere to the axiom, “He who has the gold makes the rules.”
They also rely on the too-big-to-jail principle, which as the 2008 financial crisis demonstrated, is basically a get-out-of-jail-free card, assuming you do not cross the Establishment itself (e.g., Bernie Madoff).
It is especially worth remembering that the primary trigger for the rapid 2008 market collapse was the sudden freezing of money market funds on a national scale — thereby cutting off the flow of cash required to keep companies and banks operating on a day-to-day basis.
Though to this day this action has never been publicly examined, much less explained, there are not very many institutions or private individuals capable of initiating or coordinating such a massive undertaking.
What is known, however, is not only are the same bad actors still pulling the strings behind the scenes, but also that they despise Trump’s policy of placing Americans ahead of their globalist agenda and could well choose to enact a similar catalyst for a putsch in 2020.
TO BE continued next week.
ARTHUR SMITH of Paris is a member of the local Volunteers for Freedom Tea Party. His email address is firstname.lastname@example.org.