Losing Money

A recent AP article presents the analysis of several Harvard and Yale economists on whether the trillions of dollars of a person's wealth recently lost is a gain for someone else.

They say no. It just evaporates. It is less wealth for everybody.

That is completely wrong!

The deflationary trend we are experiencing, the economics of it, is a zero-sum. That is why it is a crisis, a cyclical trend of predictable, zero-sum consequence fully intended to consolidate the wealth--a gain at the expense of the losers.

The economy is designed to produce predictable, stable results that benefits the upper class of incomes. The benefit, the gain from the loss, is empirically indicated in the IRS income bulletin. Anybody, even an Ivy League economist, can find it and very clearly see the empirical confirmation of the "transfer of wealth" to the upper class incomes FROM all the other classes.

The abstract valuations of equities, for example, they explain, is not real money to be lost or gained. It is just a number that represents the value IF you sell today.

Yes, and isn't that exactly what is going on here--fraudulent valuations of assets that has wiped out the savings of many Americans relied on for retirement. If you own equities in Overleveraged Bank of the US, those shares are now next to worthless and, as they say, is a permanent loss. That loss, however, was the result of a gain that was "realized" by the frauds in various forms prior to devaluation (deflation), and in most cases was taxed at a much lower rate than the losers possible gains, if at all.

While the loss occurred after the gain (because the loser did not sell with confidence in the valuation of the assets), the antecedent gain, realized in many forms, created the loss. Wealth was effectively transferred from the loser to the gainer. It is a zero-sum game.

If the antecedent gain was a commodity leverage, that inflation resulted in a real loss of income for the losers along with their savings due to the deflationary trend it caused. That value is no abstraction! It was a real loss, and a real gain for the players in the zero-sum game of a consolidated capital and markets.

Even if the loser holds to regain the deflated valuation, the loser must wait for the value when the gainer has realized the gain and will stand to gain even more with a retrenchment of value.

The analysis presented by the economists in this article is either exceedingly stupid or corrupt! It is the kind of pop analytics that keeps them in good standing with the wealthy endowers of these Ivy League educational institutions, from which, by the way, the vast majority of the technocrats responsible for engineering this crisis are graduates.

Reversing the loss requires recapitalizing the gains to pluralize the marketplace by deconsolidating the capital. If this is not done, then the loss, and the gain, is proportionally sustained to confirm the unaccountable processes of a consolidated capital and a consolidation of power to argue a false claim that we are all in this thing, and losing, together. That is a fraud! The distribution of the cost and benefit of this crisis is extremely inequitable and, thus, the crisis!

Economic analysis that dissembles The People's proper understanding of the "dismal science" with ideological bias is every bit dismal and, by ignoring the empirical evidence, anything but the logical positivism of science.