Goldman Sachs is only a Crap Shoot. FDIC? Not here!

Having grown up in a Fundamentalist home in the 1950s, I was taught gambling was evil and should be avoided. Possibly avoided at any cost. But the cost has been high.

So, instead of gambling at great risk, I discreetly invested my money in IRA accounts, mutual funds, and annuities. Most of which I have over the past dozen years or so have lost money on. Lost to market crashes and bad investments. Investments that weren’t insured. No FDIC. Just MDTT(money down the tubes). Money in. Money out. Gone.

So tell me, what is the difference between investing and gambling? One is legal and the other is illegal(in some places). Both can easily turn out the same. One you call a broker and the other you call a bookie. Both has its risks. Easy come. Easy go. Absolutely no assurance of making a good investment or gamble. Just a transfer of wealth from my wallet to a bank account down in the Bahamas. Gamble you do. Gamble you lose. This is what is meant by Risk Management. Only you and I take the risk. Banks and Wall Street only show us how it’s done.

What is meant by risk management is we investers take all the risks.

You know if the government wants to privatize Social Security, then require banks and investment houses to pay high interest insured deposits. Depositing a portion of FICA money into an investment account. Put about 20-percent of total monthly SS contributions into a long term bank savings account. Require banks to pay at least 5-percent interest in a FDIC insured account. Insuring absolutely no risk on the SS recipient account.

Then capitalize the FDIC with a flat 1-percent interest from high yielding home and business loans. Maybe something like it use to be. Use to be before greed took over.

However, this idea would be grossly appalling to most or all banks and investment houses. Banks want the Social Security contributors(you and me) to take all the risk. Banks just want the money with no strings attached. Free and clear. Do with as they wish with no regard for safety or responsibility. “Oh darn. You made a bad investment.”

We take all the risk. Banks and investment houses skip home free. That’s what is meant by Free Enterprise. Maybe more like Risk Enterprise.

An elephant never forgets. Only sometimes.

Did you catch last night the PBS/Front Line special on Banks, Wall Street and bailouts? All of which most Americans are aware of already. It just brought the problem to our attention once again. And we need to be reminded often because our collective memories are oh so short. Remember 1929?

None the less, during this current season of bellicose hyperbole, we need all the reminders we can get. However, phony claims are coming once again from the Banks and the Street width rapid repetition. The defenders of Big Banks, Big Finance, and Big Rip offs are crawling the streets in ever increasing numbers. Mostly in the form of congressmen and Republican presidential candidates. More specifically, from the right. Yes, Republicans are the biggest enablers of Bad Deals for America. Haters of regulations and lovers of dark places. “Take your transparency and shove it,” they might suggest.

Here is where we come in. We must ask the right questions and expect the right answers. So the acid test of their feeble intent is show us the jobs. What happened to all those tax cuts? Where is the trickle down? What happened to manufacturing? Don’t the Republicans remember Jobs-jobs-jobs! And I’m sure the same empty mantra will be shouted once again down the canyons of Wall Street. Later Shouting vociferously in a few short months by delegates to the August Republican convention.

Republicans not too long ago all but guaranteed America jobs if tax cuts are made to the rich. Oh really? Where are they? And why do we need more tax cuts? At least a dozen major tax cuts have been made over the past twenty years. Resulting mostly in very little job creation. More like manufacturing and job loss all sent to china and India.

America is finally waking up to the shallow prattles from the right. Republicans squawking empty promises again and hoping America has forgotten the Wall Street bail out and the big crash of 1929. It really hurt and we will never forget it. No! Not this time and not ever. Republicans! Shut up!

I want the money to come up here, not down there.

To give some clarity to my earlier post, I must mention a few more things.  Congress is resisting to grass root jobs programs because of many things.  Almost too numerous to mention here.  But, I’ll mention most of them anyway.

First you must understand Congress and big monied interest are sharing the same bed and both are consenting adults.  Right?  Absolutely a quid pro quo relationship.  Sort of like Congress standing by the road with a sign saying, “Will work for good money.”  Doing almost anything corporations, banks, and Wall Street ask Congress to do.  And for sure in return for cold cash for reelection campaigns and a bit more.  So you know for sure money is involved in this illegitimate relationship and willing hands to take it.  Something like Congress suckling the breasts of the adulterous lobbyists.

Second of all congress and their Sugar daddy organ grinders prefer any money spent be filtered through the upper tiers of big banking and Finance.  Absolutely not down at the grass roots.  They lose control of the money that way.  Free money is slow coming if perk elating up from the roots.  It has to pass through too many hands resulting in lesser amounts of money making it to the top.    Big Biz prefers the trickle down method instead.

Let me explain the bubbling up method.  A new hire worker is paid, he or she goes to the store to buy something, a retailer receives their money from purchases, some goes to pay the retailer’s hired help and overhead, tax money is skimmed off and sent to the city or state, wholesalers get their share, and then if anything is left bankers get the remains.  Leaving a lesser amount to add to the big bankers savings account.  So, you can see why Big Money Bizzes haven’t ever liked federal program jobs down at the grass roots level.  It takes the control away from Big Finance and Banks and leaves them with less.  Less than if they got the money first.  Are you following me?  Good.  We’ll continue this discussion later.

Goodbye Mr. Banker. Goodbye Mr. Wall Street. Can't afford the risk. I'll go it alone.

We are now in an era what I call a “Stow it under your mattress” economy.  Many folks who were burned by the past recession and who lost significant amounts of money in the stock market, funds, and annuities are now putting their cash in low interest CD’s or under their mattress.  Both grow about the same.  I wouldn’t be surprised if some mattress maker sell a box spring and mattress with a vault inside.  Now, if they could only put an ATM in there as well.

But my point is a huge amount of personal money is away from investments and Wall Street.  Away from risk.  Hidden and safe.  However, not growing.  And I’m sure that’s the way the smaller investor wants it to be.  Money holders more in control of his or her own money.

Therefore, Wall Street and banking is finding this “tight to the vest” approach as the new normal.  And most likely will be this way for years to come.  Less spend and investing and more sitting tight on personal money.  “Got burnt in 2007.”

I too recently have cashed out some funds and place it in a credit union CD account.  Just feel better about that.  I no longer trust Wall Street and big banks.  After what others and I have witnessed in the past couple of years I certainly feel I can manage my money better than the typical money managers.  Surmising that the big money people really had no interest in the safety of my investment.  But only interested in making money off my money.  Keeping the rewards to themselves while others and I suffer the losses.  But I was told over and over to stay in the market for the long run and most likely my money might grow again.  Yeah sure.  While my money sits long term in some mismanaged fund, day traders and in and out traders are using my money as leverage to spike the market, take a profit, and bale out.  Leaving me holding an empty moneybag. 

Nope.  “No thank you any more!  I’ll manage my own money.”