Of Course Americans are BROKE

[pat_k]

18. And, policies that concentrate wealth in the hands of the few at the expense of the many make for a very fragile economy

The top 10% account for 50% of our spending. If the market goes down and they get nervous, they can easily cut their spending 30%, 50%, or more.

For the rest of us, an overwhelming portion of our spending is on essentials. We aren't able to cut back anywhere near that much.

As our economy becomes more and more and more dependent on the wealthiest spending a lot of money, it becomes ever more fragile. Something happens that prompts them to cut way back, and we go straight into recession.

In addition, with America going ALL IN on AI, the market has become incredibly fragile.

The top 10 stocks in the S&P 500 account for 40% of the index’s market cap. Since ChatGPT launched in November 2022, AI-related stocks have registered 75% of S&P 500 returns, 80% of earnings growth, and 90% of capital spending growth. Meanwhile, AI investments accounted for nearly 92% of the U.S. GDP growth this year. Without those AI investments, Harvard economist Jason Furman noted, growth would be flat. As Ruchir Sharma concluded in the Financial Times, “America is now one big bet on AI,” adding, “AI better deliver for the U.S., or its economy and markets will lose the one leg they are now standing on.” This concentration creates fragility, and how the end begins becomes more visible.

More facts and figures with references in Prof G's recent article "How Does the End Begin"
https://www.profgalloway.com/how-does-the-end-begin/

Republicans have been intentionally building this incredibly fragile economy by steadily shoveling money at the wealthy, to make them wealthier, and keep them spending. There is NO "trickle down," only "trickle up." And now they are propping up AI with vast expenditures of our treasury dollars and by allowing a host of circular, incestuous deals that are massively and artificially inflating values.

This is a VERY bad thing for economic and political stability. We have been heading toward a breaking point of some kind for a long, long time.. I firmly believe the trump insanity is the last gasp before things seriously falls apart.

We may yet save ourselves by implementing truly transformative reforms in time, but even with that, there will be a scary time of adjustment from our current obscenely immoral and fragile economy to a more moral and robust economy.