Bank Guarantees and Bailouts - A Transfer - from the Poor to the Rich - Golem
David Malone proposes a very simple explanation why the banks are being bailed out, rather than the mass of citizens.
Think of your own situation. How much of your wealth is held in the value of your house and how much in stocks and bonds? Almost all my wealth is contained in my house. The super rich, the top 1-10% hold much, much more of their wealth, vast bulk of it, in financial form. That huge increase in ‘wealth’ from the 90′s onwards was concentrated in financial wealth. That is the kind of wealth that made and still makes the super rich, super rich.
What these two graphs tell us is that if the big banks had been wound up 80% of Americans would have lost almost nothing. Whereas the top 5% would have lost the vast bulk of their wealth and therefore their power.
“ We cannot withdraw our cards from the game. Were we as silent and mute as stones, our very passivity would be an act. ”
— Jean-Paul Sartre