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Nomi Prins: A World That Is the Property of the 1%
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This year, I simply couldn’t get one fact out of my head: according to a 2017 report from the Institute for Policy Studies, three billionaires — Jeff Bezos, Warren Buffet, and Bill Gates — have amassed as much wealth as the bottom half of American society. That’s 160 million people! (And unlike our president, I don’t use exclamation points lightly or often.) Or as Oxfam reported in January of this year, the wealth of eight men — and yes, they were men (including the three mentioned above) — was equal to that of half the people on this planet in 2017. Yikes! And just to give you a sense of where we’ve been heading at supersonic speed, an Oxfam report a year earlier had 62 billionaires owning half the planet’s wealth. Imagine that: 62 to eight in a single year.

Then consider what we know about the rise of the billionaire class. Again, according to Oxfam, a new billionaire appeared every two days in 2017, while 82% of the wealth being created on this planet already went to the top 1% and the bottom half of the global population saw no wealth gains at all. In 2017 (the last year for which we have such figures), the total wealth of the globe’s billionaire class ballooned by almost 20%. (And I want you to know that, unlike our president, I’m fighting hard to restrain the urge to put one or more exclamation points after every one of those sentences.)

Oxfam released its figures this January to coincide with the annual meeting of the world’s top dogs at Davos in Switzerland. Assumedly, it will do so again in January 2019 and I shudder to think what the next set of stats are likely to be. In the meantime, consider what TomDispatch regular Nomi Prins, author most recently of Collusion: How Central Bankers Rigged the World, has to say about a planet on which the actual economic situation of most people bears remarkably little relationship to what’s generally advertised and why, if you think stability is already a thing of the past in a Trumpian world, you ain’t seen nuthin’ yet.

(Republished from TomDispatch by permission of author or representative)
 
• Category: Economics • Tags: Inequality, Wall Street 
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  1. Renoman says:

    I wonder when the 1% will figure out that we’re comin for em and it WILL be Medevil.

    • Replies: @Longfisher
  2. “… if you think stability is already a thing of the past in a Trumpian world, you ain’t seen nuthin’ yet.”

    Neo Feudalism was well in place before Trump was elected. It’s not a Trumpian world. It’s not even a Trumpian country. And Imperial Washington is definitely NOT a Trumpian city. Trump is one man. He did not ruin, is not ruining and will not ruin the world. And I resent your underhanded attempt to make me believe he did, is and will.

    A few have everything while many have nothing. You could write about it without blaming Trump. But you don’t because you are a partisan hack in service to the ruling class.

    • Agree: Almost Missouri
  3. The following is an excerpt from a work-in-progress that deals with the means by which the 1% obtain their wealth, as per the following caution from the House of Lords in a criminal fraud case:

    One must not confuse the object of a conspiracy [to defraud] with the means by which it is intended to be carried out. Scott v. Metropolitan Police Commissioner [1974] 60 Cr. App. R. 124 H.L.

    Almost all commentary on the issue of our extreme wealth disparity deals with our ever-building outrage over the fact of it (the object) instead of the much more critical means by which it is achieved.

    Here below I explain what is called an “Assignment of Rents” which the bank in the example transaction demanded in addition to the mortgage on the commercial property. The nominal or alleged joint-borrowers are referred to as “BuyerCo/SellerCo”.

    The Assignment of Rents

    At this point it is both illuminating and instructive to descend another level into the global socio-economic and socio-financial rabbit hole.

    [MORE]

    One of the nominal collateral securities required by the bank was called an Assignment of Rents. Under the terms of the Assignment of Rents the nominal bank gets more or less the same ownership rights to the business cash flow as it does to the building and property itself under the mortgage.

    So BuyerCo/SellerCo had to issue and register two separate and distinct securities with different (but consecutive) securities registration numbers from the Land Title Office / Registry. One for the Mortgage, and one for the Assignment of Rents.

    In this case the project was to take a well-located 40-suite (large suites) residential apartment building, that was already owned near free and clear by one of the constructive partners, and renovate and convert it to an 80-suite (smaller / half-size suites) extended-stay hotel / motel business, at a cost of about $2 million.

    The owner of BuyerCo had the concept and the experience and management expertise in the hotel / motel industry, and the owner of SellerCo was the near clear-title-owner of the property that was both strategically located and had an ideal layout for the conversion.

    The existing apartment / residential accommodation business had an annual cash flow of 40 suites times about $12,000, or $500,000, more or less.

    If the owner were to issue an Assignment of Rents, then the receiver of it would receive a legal security covering (or securitizing) that $500,000 per year.

    As an extended-stay hotel business, however, the same building and operating business would generate 80 suites times $25,000 per year, or $2 million per year in cash flow.

    Most people who have occasion to even think about it, believe that the Assignment of Rents is a kind of contingency provision that is triggered by an act of default, and which then allows the banker to step in to receive the rents directly from the tenants. While that is true, it is far from the whole truth.

    Most anything of any substantial value, basically anything with a serial number – has both a legal-title and a use-title (“yoose”-title) or equity title.

    A most simple apparent example is as with a rental car. The rental company owns and possesses the legal-title, while the renter temporarily obtains the use-title or use of the vehicle as represented by the rental contract. The renter enjoys the use of the vehicle for one purpose (e.g., to go to the beach), while the legal-title holder employs the same vehicle in a profit-making (car rental) business enterprise.

    Likewise, assume that you own outright 10,000 new vans or pick-up trucks, and that you decide to employ them or invest them in the operation of a global package-delivery service to make business profits. At the same time, you can pledge the legal-titles to the same trucks or even the operating business itself as security / premium for credit (albeit in the existing bogus system) by which to obtain capacity to invest in the stock markets so as to earn an additional income stream and return on the spread, and, again, effectively from the same trucks.

    What the private financial system does under the Assignment of Rents is to apply the same title-duality or divided-titles directly to financial instruments and, as here, directly to money (cash flow) itself.

    There is in fact precedent for at least the bare concept. There is for example a certain 1950’s era Bank of Canada $1,000 bill (currency note) that is still valid and worth $1,000 as legal tender.

    But the same chattel or thing has an alternative and real market value of about $14,000 as a collectors’ item or numismatic item.

    But, and critically, it can only be used as one or the other at any given time, and not both concurrently as with the Assignment of Rents.

    So if there were to be an act of default, then the bank / banker would step in under the Assignment of Rents to demand and receive the rents directly from the tenants / guests. But in such case it is now also obtaining the actual or equity title to the rents, while concurrently continuing to enjoy the legal-title to the same rents in the financial markets.

    In 2006, the owner of BuyerCo discovered or was informed during a chance encounter with a former associate (while attempting to trace the nominal mortgage in the markets), that, after the nominal transaction, the bank had obtained what it is called a CUSIP or securities registration number on the separate Assignment of Rents, and that it was then being used in a basket of securities that had been used to secure some form of bonds that were trading on the London Exchange and the NYSE.

    The nominal loan transaction lasted in fact for about 10 years to 2006, during which BuyerCo/SellerCo paid the bank an additional total of about $1.5 million in interest called interest under the mortgage (plus payment-again or re-payment of the kited principal).

    But over the same ten year period the total cash-flow from the rents, and securitized by the Assignment of Rents, was $2 million per year, or $20 million total, or about 14 times more / greater than under the nominal mortgage transaction.

    So if we do an equity-audit of the whole nominal transaction, we may well find that the bank obtained more ill-gotten-gains / unjust enrichment from the Assignment of Rents than it did from the equally falsified mortgage.

    For those who may be somewhat confused, the concept is quite simple.

    There are two de facto parallel universes operating on this planet, one for the 99%, and one for the 1%.

    The de facto national anthem for the 99% is “Working on the Chain Gang”.

    The de facto national anthem for the 1% is the “Money for Nothing” song (I want my MTV).

    As long as you are a member of the 1% Club you can convert virtually anything of value into more income for yourself – as long as you take it away from a productive member of the 99%.

    Is that clear?

  4. anonymous[340] • Disclaimer says:
    @WorkingClass

    He is indeed, a burnout anti-war dissident who has a nice niche carrying the battle flag for Team Blue. The parenthetical, sophomoric TDSpittle comes across as parody.

    Pathetic!!

    • Replies: @anonymous
  5. m___ says:
    @WorkingClass

    The agenda for a fraction of the spoils. Engelhardt, Prins, base democratic party militans. Every old trick in the book, scribes for scraps, a Jewish middle-class phenomenon.

  6. @Renoman

    Not to be picky, but I’m pretty sure you meant medieval.

    No worries. I type fast too.

  7. @WorkingClass

    What Working Class said was perfectly logical.

    The Clintons will be billionaires as will the Obamas. I know of young women who paid $150 per seat to hear Michelle Obama talk. Some paid thousands of dollars to sit up close. Michelle Obama has not had it hard- she has had a cozy life. Hard is having a terrible medical affliction at a young age or dying in a war or dying young in a coalmine (and leaving 8 kids behind)like one of my grandfathers did.
    The ongoing ills are not due to Trump. They existed well before he entered office.There is no difference between Democrats and Republicans when it comes to greed and amassing wealth. The article could have done just fine without the Trump references, but anti Trumpers cannot help themselves plus they are often cowards: Trump won’t have hacks going through your income tax returns like the Clintons and Obamas did.
    I do not belong to a political party. Liberals always have an agenda. Trump has been in office for two years. The leftist Democrats could have had a president in James Webb but he was not the radical they wanted.
    Did not Hillary Clinton get 11 times as much money from Wall Street than Trump got?
    I like Engehardt’s writings.
    Working Class did not need criticism . These people who rant on Trump would not have the guts to call out Democrats like the Clintons and Obamas.

  8. I should have written that the Democrats wanted a radical leftist and it should be a female so they picked a very vicious, bigoted woman who lost the Presidential election. She in cahoots with the FBI and other big shots committed big crimes against the elected President. There was no rule of law under Obama-the Democrats did whatever they wanted, and our FBI LET THEM DO WHATEVER THEY WANTED!

    James Webb of course is not a radical. He voted against the Iraq invasion of 2003 (one of the few who voted against it). Webb could likely bring Democrats and Republicans together but this is not what big money, the Democrats , and their Deep State wanted.
    Tom Engelhart is not a coward but most people are. They don’t dare go after Clinton crimes because the Clintons can be very vindictive. A big tactic of the Clintons is to have the IRS go after people.

  9. anonymous[340] • Disclaimer says:
    @anonymous

    And why does Mr. Engelhardt enjoy the privilege of having these introductions published separately from the article of the, as he vainly reminds us, “TomDispatch regular”?

    Ms. Prins’ “Wall Street, Banks, and Angry Citizens” is here under Economics Articles, where it has already received four comments; so we have commenters literally talking past each other, diminishing one of the best aspects of TUR. On other occasions, IIRC, the article had to be accessed at TomDispatch itself.

    Assuming (very) hypothetically that TomDispatch or its parent The Nation wanted to amplify a TUR article written by, say, Linh Dinh or C. J. Hopkins, it’s hard to imagine Mr. Unz requesting, much less receiving, such an annoying little soapbox.

  10. From reading Nomi Prin’s articles, I realize that even with all of this wealth accumulation at the top, .gov is funneling devalued fiat currency to many of America’s banks and corporations, keeping many debt-laden zombies afloat. It is amazing that companies have amassed so much debt, tying up their money in interest and further suppressing wage growth in the USA, especially since so many of these American-in-name-only companies amassed so much wealth by evading the middle-class wage structure in their own country. It is not as hard to see why some banks struggle, given that most of their customers have not seen a pay raise or a stable, reliable job in 40 years.

    Many of America’s millionaires—and a few of its billionaires—accumulated so much wealth due to the government-aided replacement of the indigenous US labor force with legal / illegal immigrants and single-mom / married mom employees, many of whom can afford to work for low wages, in part-time jobs or in a temporary capacity, thereby reducing the labor expense of said millionaires / billionaires. Many citizen and non-citizen parents can afford to do that due to spousal income, child support checks or, in single-breadwinner households, by strategically staying under the income limits for (1) monthly welfare and (2) child-tax-credit cash up to $6,431 that covers their major household bills, like rent that is unaffordable to single workers living on earned-only income.

    But the wealth of at least 2 of America’s top-3 billionaires, along with the wealth of many of the other 62 billionaires, accrued mostly due to a dramatically reduced labor expense from offshoring over 6 million factory jobs just between 2000 — 2010, in addition to lots of outsourcing, to Asian countries with ultra-cheap labor pools. The wealth accrued to them by sacrificing America’s middle-class prosperity to a billion wage slaves in China. A handful of millionaires / billionaires were created in China, too, in the process.

    https://www.consumerreports.org/cro/magazine/2013/02/made-in-america/index.html

    The biggest ironies are the lofty moral priorities of the Globalist Era’s Western billionaires: 1) climate change and 2) global-poverty reduction.

    1) Climate Change (haha): Western billionaires and their politician chums jumpstarted global-scale natural-resource hogging by shifting over 6 million American industrial jobs to the world’s most populous nation—China—a massive country that was still largely rural and non-energy-hogging even in the early 1980s. By ditching America’s $25-per-hour Northern labor and its $7-per-hour Southern labor for .30-cent-per-hour labor in China, these Protectors of the Planet accelerated the rate of natural-resource consumption………exponentially. Their attempts to control what global dictators do by attending fancy, globe-trotting, global-warming conferences are either PR stunts or naive-cubed. Global dictators are hell-bent on feeding the colossal number of humans that their citizens have pumped out via things like environmentally-unfriendly coal production on steroids and their own government-financed factories, churning out items sold into their internal market. Citizens of foreign countries produce the so-called “American” products, while buying products made by their own countries’ companies. Some of those foreign-owned companies use pilfered designs, including designs by Chinese-financed American startups, using taxpayer-funded research done in American universities.

    https://www.theepochtimes.com/zhang-was-being-touted-for-a-nobel-prize-in-physics-why-did-he-kill-himself_2733573.html

    2) Poverty Reduction (haha): Western billionaires and their politician servants have simply shifted poverty and social unrest from underdeveloped, foreign countries to the developed, Western countries that sired them, leaving the countries that provided them with huge opportunities—their own countries—in situations where even maintaining stable, functioning, elected governments is much less certain.

    It is not really the fault of non-Western, government-backed billionaires who likely regard Westerners—the Deplorables, the billionaires and the multi-millionaire politicians—as willing chumps.

    Lecturing to cash-strapped citizens of their own countries who were often raised middle class, but who increasingly cannot even afford the dignity of a one-room apartment, Western billionaires and their politician butlers bemoan the perils of climate change and global poverty…………….

    Yet, these virtue-signaling Western billionaires and the politicians they own are determined to triple natural-resource consumption by encouraging more population giants, like India and Africa, along with many smaller, underdeveloped countries, to gear up their industrial production, just like they did with China, providing Western billionaires with more young wage slaves until the robots are ready to hit the factory floors running.

    Billionaires will continue to reduce their labor expense in that way—while sneaking in more robots to undercut their offshored, immigrant and welfare-fueled workforce—in addition to lobbying our corrupt Uniparty politicians. Until they get their 100% subservient, $0-per-hour robot workforce in place, American billionaires will continue to undermine voters, making sure that our votes mean nothing. They will continue to pressure our bought-and-paid-for US politicians to import between 1.7 — 1.5 million new legal immigrants each year, adding to the umpteen-million welfare-assisted illegal immigrants competing for jobs, undercutting millions of US citizens who are underemployed or out of the labor force in record numbers.

    Billionaires will continue to insist that immigrants receive tax credits and welfare for US-born kids, enabling them to undercut many native-born citizens by working cheaply. Billionaires will likewise continue to advocate for programs that pay citizens and noncitizens to reproduce, increasing the amount of welfare and tax-credit money per resource-consuming, environmentally-unfriendly humans birthed, thereby ensuring that many non-welfare-eligible, non-womb-productive citizens are undercut in the labor markets of their own countries…….forever.

    They will do that for money-minded reasons, while lecturing to American and European Deplorables about the environment.

    Wonder how many environmental toxins are emitted from factories in China, pumping out Yellow Vests for displaced Western workers, making too little to cover rent?

  11. anon[215] • Disclaimer says:

    Or as Oxfam reported in January of this year, the wealth of eight men — and yes, they were men (including the three mentioned above) — was equal to that of half the people on this planet in 2017

    odd, i don’t see the Rothschilds anywhere on that list

    what does it mean? their list is a joke?

  12. Trump is Commander in Chief now, not Obama or Clinton… who should she be criticizing?

    Trump chose to give the rich a big tax cut that they didn’t need, Trump chose to appoint all of the swamp he has, the Goldman Sachs swamp creatures. What does any of this have to do with obama or Clinton?

    Trump is da head honcho, he gets the blame now, not the previous puppet. He has earned every bit of it.

    Prins was just as critical of obama when he was in office, hes not now, Trump is. But Trump is a puppet just like obama, just like Bush, just like Clinton. The real rulers do not hold elections, sorry..

    http://www.nomiprins.com/thoughts/2012/10/23/before-the-election-was-over-wall-street-won.html

    Before the campaign contributors lavished billions of dollars on their favorite candidate; and long after they toast their winner or drink to forget their loser, Wall Street was already primed to continue its reign over the economy.

    For, after three debates (well, four), when it comes to banking, finance, and the ongoing subsidization of Wall Street, both presidential candidates and their parties’ attitudes toward the banking sector is similar – i.e. it must be preserved – as is – at all costs, rhetoric to the contrary, aside.

    Obama hasn’t brought ‘sweeping reform’ upon the Establishment Banks, nor does Romney need to exude deregulatory babble, because nothing structurally substantive has been done to harness the biggest banks of the financial sector, enabled, as they are, by entities from the SEC to the Fed to the Treasury Department to the White House.

    In addition, though much is made of each candidates’ tax plans, and the related math that doesn’t add up (for both presidential candidates), the bottom line is, Obama hasn’t explained exactly WHY there’s $5 trillion more in debt during his presidency, nor has Romney explained HOW to get a $5 trillion savings.

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