Saturday, October 6, 2012

Phony Unemployment Rate Goes With Phony Character of Obama

Mark Matheny
October 6, 2012


How convenient it is that the unemployment rate should drop as fast as Obama's popularity rate!

More propaganda.......

Related videos:

Another Phony Employment Report

Paul Craig
Oct 6, 2012
October 5. Today’s employment report from the Bureau of Labor Statistics shows 114,000 new jobs in September and a drop in the rate of unemployment from 8.1% to 7.8%. As 114,000 new jobs are not sufficient to stay even with population growth, the drop in the unemployment rate is the result of not counting discouraged workers who are defined away as “not in the labor force.”

According to the BLS, “In September, 2.5 million persons were marginally attached to the labor force.” These individuals “wanted and were available for work,” but “they were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.”
In other words, 2.5 million unemployed Americans were not counted as unemployed.
The stock market rose on the phony good news. Bloomberg’s headline: “U.S. Stocks Rise as Unemployment Rate Unexpectedly Drops,” .
A truer picture of the dire employment situation is provided by the 600,000 rise over the previous month in involuntary part-time workers. According to the BLS, “These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.”
Turning to the 114,000 new jobs, once again the jobs are concentrated in lowly paid domestic service jobs that cannot be offshored. Manufacturing jobs declined by 16,000.
As has been the case for a decade, two categories–health care and social assistance (primarily ambulatory health care services) and waitresses and bartenders account for 53% of the new jobs. The BLS never ceases to find ever growing employment of people in restaurants and bars despite the rising dependence of the US population on food stamps. The elderly are rising as a percentage of the American population, but I sometimes wonder if employment in ambulatory health care services is rising faster than the elderly population. Whether these reported jobs are real, I do not know.
The rest of the new jobs were accounted for by retail trade, transportation and warehousing, financial activities (primarily credit intermediation), professional and business services (primarily administrative and waste services), and state government education, where the 13,600 reported new jobs seem odd in light of the teacher layoffs and rise in classroom size.
The high-tech jobs that economists promised would be our reward for offshoring American manufacturing jobs and tradeable professional services, such as software engineering and IT, have never materialized. “The New Economy” was just another hoax, like “Iraqi weapons of mass destruction” and “Iranian nukes.”
While employment falters, the consumer price index (CPI-U) in August increased 0.6 percent, the largest since June 2009. If the August rate is annualized, it means bad news on the inflation front. Instead of bringing us high tech jobs, is “the New Economy” bringing back the stagflation of the late 1970s? Time will tell.
Dr. Paul Craig Roberts is the father of Reaganomics and the former head of policy at the Department of Treasury. He is a columnist and was previously the editor of the Wall Street Journal. His latest book, “How the Economy Was Lost: The War of the Worlds,” details why America is disintegrating.

Man Tells Obama: Business 'Terrible Since You Got Here'

Weekly Standard
October 6, 2012

An Ohio man at the market told President Obama that business has been "Terrible since you got here," according to the White House pool report. Via the pool report:
Potus stopped to meet people waiting for him, where he did the requisite hand-shaking, high-fiving and the rare baby-holding before going on to chat with proprietors at Turczyk's Meats and the adjoining Larry Vilstein's, Christopher Bakery and Edward Badbuster & Son. He then asked the proprietor at Rolston Poultry how business was going. "Terrible since you got here," the man said. Pool could not get close enough to the Rolston Poultry man to get his name or political affiliation. Potus didn't appear amused by the sentiment. 
Read the entire article 

Israeli air force shoots down drone aircraft

Yahoo News
October 6, 2012

JERUSALEM (Reuters) - The Israeli air force shot down a drone after it crossed into southern Israel on Saturday, the military said, but it remained unclear where the aircraft had come from.
The drone was first spotted above the Mediterranean Sea in the area of the Hamas-ruled Gaza Strip to the west of Israel, said military spokeswoman Avital Leibovich.
It was kept under surveillance and followed by Israeli air force jets before it was shot down above a forest in an unpopulated area near the border with the occupied West Bank.
Leibovich said it was shot down at about 10 a.m. (0700 GMT), after it traveled east some 35 miles across Israel's southern Negev desert.
Defense Minister Ehud Barak praised the interception as "sharp and effective".
"We view with great gravity the attempt to compromise Israeli air space and will consider our response in due course," Barak said in a statement.
Soldiers were searching the area for the remains of the drone, which security sources said most likely did not originate from the Gaza Strip. It was not immediately clear whether it was armed.
On at least one occasion, Iranian-backed Hezbollah, a Shi'ite group in Lebanon, has launched a drone into Israel. And in 2010, an Israeli warplane shot down an apparently unmanned balloon in the Negev near the country's Dimona nuclear reactor.
(Reporting by Ari Rabinovitch and Amir Cohen; Editing by Myra MacDonald)

Friday, October 5, 2012

$4 gas: Get used to it

CNN News
October 5, 2012

A new U.N. report says the massive bets placed on the commodities markets are the "root cause" of the volatility in oil and gas prices. And that's not about to change.

By Leah McGrath Goodman
gas-pricesFORTUNE -- President Obama may have a lot more to worry about than bombing the debate this week. Traders are starting to get particularly bullish over gasoline prices – and that is bad news for the average driver, who may also be looking to vent his spleen at the voting booth.
Reports of gas shortages along the high-demand west and east coasts may be fleeting – although deeply concerning – but they highlight a problem that's expected to persist in the U.S.: our refineries are getting old. Given that a new refinery has not been built since 1976, commodities desks on Wall Street are bracing for more refinery outages and fires just as the nation needs to gear up for the busy winter heating season.
What does that mean? Probably more weeks where we'll see U.S. crude oil inventories hovering above the upper limit of the average range for this time of year, yet gasoline inventories tunneling into the lower half of their average range, as the U.S. Energy Information Administrationreported Wednesday.
Translated in dollars and cents, retail gas prices likely won't be moving off the $4 needle anytime soon. In fact, some gasoline buyers think this may even usher in a run to $5 a gallon (especially out west where gas stations are shutting down because they cannot buy gas at price levels low enough to turn a profit).
The firmness in gasoline also is giving oil prices a boost, the knock-on effects of which cannot be understated.
Oil price spikes and consumer prices have been "highly correlated" over the past decade, according to the EIA, the nonpartisan statistics branch of the U.S. Department of Energy. The upshot? Americans are increasingly grappling with unchanged paychecks in the face of higher energy prices. Their money is buying them less, the EIA says, citing the Bureau of Labor Statistics' Chained Consumer Price Index.

Thursday, October 4, 2012

Why Only 2 Candidates in The Presidential Debates?
Oct 4, 2012
It’s only natural that the Democratic incumbent, Barack Obama, and the Republican challenger, Mitt Romney, should participate in tonight’s first presidential debate, but in fact there are two other candidates who qualified for the ballot in enough states that they could, technically, win the election.

Warnings That A Massive Stock Market Crash Is Imminent

Michael Snyder
The Economic Collapse
Oct 4, 2012
In the financial world, the month of October is synonymous with stock market crashes.  So will a massive stock market crash happen this year?  You never know. The truth is that our financial system is even more vulnerable than it was back in 2008, and financial experts such as Doug Short, Peter Schiff, Robert Wiedemer and Harry Dent are all warning that the next crash is rapidly approaching.

We are living in the greatest debt bubble in the history of the world and Wall Street has been transformed into a giant casino that is based on a massive web of debt, risk and leverage.  When that web breaks we are going to see a stock market crash that is going to make 2008 look like a Sunday picnic.  Yes, the Federal Reserve has tried to prevent any problems from erupting in the financial markets by initiatinganother round of quantitative easing, but 40 billion dollars a month will not be nearly enough to stop the massive collapse that is coming.  This will be explained in detail toward the end of the article.  Hopefully we will get through October (and the rest of this year) without seeing a stock market collapse, but without a doubt one is coming at some point.  Those on the wrong end of the coming crash are going to be absolutely wiped out.
A lot of people focus on the month of October because of the history of stock market crashes in this month.  This history was detailed in a recent USA Today article….
When it comes to wealth suddenly disappearing, October can be diabolically frightful. The stock market crash of 1929 that led to the Great Depression occurred in October. So did the 22.6% plunge suffered by the Dow Jones industrial average in 1987 on “Black Monday.”
The scariest 19-day span during the 2008 financial crisis also went down in October, when the Dow plunged 2,675 points after investors fearing a financial collapse went on a panic-driven stock-selling spree that resulted in five of the 10 biggest daily point drops in the iconic Dow’s 123-year history.
So what will we see this year?
Only time will tell.
If a stock market crash does not happen this month or by the end of this year, that does not mean that the experts that are predicting a stock market crash are wrong.
It just means that they were early.
As I have said so many times, there are thousands upon thousands of moving parts in the global financial system.  So that makes it nearly impossible to predict the timing of events with perfect precision.  Financial conditions are constantly shifting and changing.
But without a doubt another major financial collapse similar to what happened back in 2008 (or even worse) is on the way.  Let’s take a look at some of the financial experts that are predicting really bad things for our financial markets in the months ahead….
Doug Short
According to Doug Short, the vice president of research at Advisor Perspectives, the stock market is somewhere between 33% and 51% overvalued at this point.  In a recent article he offered the following evidence to support his position….
● The Crestmont Research P/E Ratio (more)
● The cyclical P/E ratio using the trailing 10-year earnings as the divisor (more)
● The Q Ratio, which is the total price of the market divided by its replacement cost (more)
● The relationship of the S&P Composite price to a regression trendline (more)
Peter Schiff
Peter Schiff, the CEO of Euro Pacific Capital, has been one of the leading voices in the financial community warning people about the crisis that is coming.
During a recent interview with Fox Business, Schiff stated that the massive financial collapse that we witnessed back in 2008 “wasn’t the real crash” and he boldly declared that the “real crash is coming”.
So is Schiff right?
We shall see.
Robert Wiedemer
Economist Robert Wiedemer warned people what was coming before the crash of 2008, and now he is warning that what is coming next is going to be even worse….
“The data is clear, 50% unemployment, a 90% stock market drop, and 100% annual inflation . . . starting in 2012.”
Harry Dent
Financial author Harry Dent believes that the stock market could fall by as much as 60 percent in the coming months.  He is convinced that stocks are hugely overvalued right now….
“We have the greatest debt bubble in history. We will see a worldwide downturn. And when you are in this type of recessionary environment stocks should be trading at five to seven times earnings.”
So are these guys right?
We shall see.

Who controls the wealth in the US? Western countries expand balance sheets at the expense of their younger population.

October 4, 2012

If the debates reflected the true interest of what Americans have on their mind the entire debate would revolve around the slow erosion of the US middle class.  Yet this is something that will only be a footnote and for any discussions that do come up the specifics will be lacking.  The reality is we do have a middle class crisis in the US.  Americans are being fleeced through inflation on daily goods and we have an incredible 46+ million Americans on food stamps, a record percentage of our population.  Yet the stock market slowly inches up to a near record high.  How is it then that most Americans because of this recession lost 30 to 40 percent of their wealth?  Part of this has to do with how wealth in the US is structured.  The reality is we are making it tougher for mobility to occur thanks to the massive higher education bubble.
Who controls wealth in the US?
When you really boil it down wealth is the best measure of economic wellbeing.  Saying that the per capita income is $25,000 or the median household income is $50,000 only takes you so far.  Most Americans barely have enough to get by.  One out of three Americans has no savings to their name and those that do, typically have a massive portion locked up in home equity, a major reason why the net worth figures took such a big hit.  But first, let us see how wealth is structured in the US:
us wealth
The top 5 percent control nearly 64 percent of all the wealth in this country.  What is even more important to highlight is that most of the financial wealth (i.e., stocks, bonds, etc) are held by this small group.  This is a primary reason why the stock market jumping up over 100 percent from the low in March of 2009 has largely done very little to help the bottom line of most Americans.  Many companies also increased gains by overseas expansion and also cost cutting via layoffs/wage reductions.
The Federal Reserve has been instrumental in ensuring success for this group but at the expense of many Americans.  For example, the policies of QE3 are forcing rents to increase dramatically:
Many lower income and working class families are unable to own so creating a market where rents are forced up largely pushes up their financial burden.  You are also seeing major inflation in food costs which is a direct hit to those 46 million Americans on food stamps.  Everything comes at a cost and the current trajectory is largely a drag on working and middle class families.  The figures are as clear as day:
This recession has done a number on the middle class.  However what we are also seeing are some deep structural changes to our demographics.  We have a large and older population with baby boomers entering retirement age.  We have a smaller less affluent younger generation that will need to support this generation.  Yet we are seeing major changes in household formation:
Family household formation
What busted the trend?  You have a record number of 25 to 34 year olds moving back home with parents and you also have the delay of household formation.  Expensive housing costs and also a giant burden of student debt is a reason to blame for this.  It is also good to highlight that younger Americans took on the deepest hit from this recession:
change in net worth recession
Boom and bust cycles are largely a part of the global game.  Other countries that are facing challenges with their youth are places like Spain for example.  Spain is also feeling the brunt of a bursting housing bubble:
Spain housing market
Spain housing market index; 2005=100 (Bloomberg)
Of course the European Central Bank like the Fed has been laser focused on protecting their small wealthy class while the youth unemployment rate is up to 50 percent:
ECB balance sheet
ECB balance sheet (€mm)
Welcome to the new world economy.  Of course little of this will be mentioned over the next month leading up to the election.

Federal Court Rules In Favour Of Indefinite Detention Of US Citizens

Obama’s emergency stay on NDAA block extended
Steve Watson
Oct 3, 2012

A federal appeals court has ruled that the US government can still indefinitely detain citizens should it wish to do so, under the Obama Administration’s National Defense Authorization Act.
The ruling came in the form of an extension of an “emergency” stay of a district court judge’s order that had previously struck down the defence bill’s provisions altogether.
Last month District Judge Katherine Forrest permanently blocked the NDAA provision, saying that “First Amendment rights have already been harmed and will be harmed by the prospect of (the law) being enforced.”
However, the very next day the Obama administration moved to appeal the decision in an attempt to reinstate the indefinite detention provisions. The administration characterized the ruling by Forrest as unconstitutional.
Federal judge in New York, Raymond Lohier, then granted the Obama administration an “emergency” stay that temporarily blocks Forrest’s ruling.
Late yesterday, a three-judge motions panel of the U.S. Court of Appeals for the 2nd Circuit extended that stay, supporting the administration’s appeal and intimating that Forrest’s ruling is flawed.
“We conclude that the public interest weighs in favor of granting the government’s motion for a stay,” Appeals Court Judges Denny Chin, Raymond Lohier and Christopher Droney wrote in athree-page order that also expedited the appeal.
All three judges on the panel were appointed to the appeals court by Obama.
The order continues:
First, in its memorandum of law in support of its motion, the government clarifies unequivocally that, ‘based on their stated activities,’ plaintiffs, ‘journalists and activists[,] . . . are in no danger whatsoever of ever being captured and detained by the U.S. military.’
Second, on its face, the statute does not affect the existing rights of United States citizens or other individuals arrested in the United States. See NDAA § 1021(e) (‘Nothing in this section shall be construed to affect existing law or authorities relating to the detention of United States citizens, lawful resident aliens of the United States, or any other persons who are captured or arrested in the United States.’).
Third, the language of the district court’s injunction appears to go beyond NDAA § 1021 itself and to limit the government’s authority under the Authorization for Use of Military Force…
Concerned Americans have argued that the NDAA provision could see American citizens kidnapped and held indefinitely without charge.

Texas Students Treated Like Cattle with Mandatory RFID Tags
Oct 3, 2012
Students and parents at two San Antonio schools are in revolt over a program that forces kids to wear RFID tracking name tags which are used to pinpoint their location on campus as well as outside school premises.

Wednesday, October 3, 2012

Leon Panetta CIA Links to World Government Rockefeller Agenda 21 - Gary Arnold

You Tube
October 3, 2012

The Panetta Institute is on the grounds of the decomissioned Fort Ord Army base. Donated to the institute from the Governement? There are so many World Government links here as Gary Arnold explains. Mr Arnold ought to know...he ran against him for political office. Since then Leon Panetta has gone far, but now has lost his CIA post...why? And why did he go so far? As we can see he was very connected in the first place..that is why.
(permission granted from rcoones102 to mranthonyjhilder)

Tuesday, October 2, 2012

TSA to install molecular body scanners

RT News
October 2, 2012

Oct 2, 2012 by 
TSA is introducing the new full body scanner system to the American airports. The scanners will be capable of detecting every tiny trace of any substance of your body to find gunpowder or any bomb making materials. However the devices can also trace the level of adrenaline in the body. RT's Kristine Frazao has more on the subject.

Update: Michigan Counties Continue the Fight Against NDAA

The New American
October 1, 2012

Update: Michigan Counties Continue the Fight Against NDAA
Soon Michigan may join the list of other states who have passed legislation checking the president’s power under the National Defense Authorization Act (NDAA) to indefinitely detain American citizens.
On Monday, September 24, constitutionalists and friends of liberty gathered at the Oakland County (Michigan) General Government Committee Meeting to support Commissioner Jim Runestad’s Liberty Preservation Resolution. Blake Filippi of the Tenth Amendment Center (TAC) originally drafted this measure with the assistance of the Rhode Island Liberty Coalition. 
Reports to The New American from those attending the meeting indicate that many residents attended the meeting, as well, and passionately defended the right of Americans to live without the specter of an all-powerful police state looming over their every action.
One citizen, Anna Janek, stood at the meeting and recounted a childhood living in fear of government and police in communist Czechoslovakia.
A follow-up meeting to consider the anti-NDAA proposal is scheduled for Monday, October 8 and 9:30 A.M.
Apart from the noble work being done in Oakland County, State Representative Tom McMillin (R-Rochester Hills, pictured above, at left) has introduced a bill in the state legislature that would prevent the president’s power to indefinitely detain Americans from crossing the Wolverine state borders.
McMillin’s measure, HB 5768, would prevent the arrest and indefinite detention of citizens of his state under the authority of relevant provisions of the NDAA. According to the text of the legislation
No agency of this state, no political subdivision of this state, no employee of an agency of this state or a political subdivision of this state acting in his or her official capacity, and no member of the Michigan national guard on official state duty shall aid an agency of the armed forces of the United States in any investigation, prosecution, or detention of any person pursuant to 50 USC 1541, as provided by the federal national defense authorization act for fiscal year 2012.
The day after citizens turned out to support the cause of freedom in Oakland County, over 40 concerned Michiganders attended the Michigan State House Oversight, Reform and Ethics Committee chaired by Representative McMillin.
Led by TAC state coordinator Shane Trejo, representatives from a coalition of groups devoted to the protection of individual liberty testified in favor of McMillin’s bill and the principle of due process. The organizations present at the hearing included People Against NDAA, Campaign for Liberty, Downsize D.C., the Bill of Rights Defense Committee, and the ACLU among others.
Notably, consistent defender of the Constitution Congressman Justin Amash (R-Mich.) appeared before the committee and spoke in support of HB 5768.

TSA Confiscates Camera, Deletes Footage of Checkpoint

TSA workers steal memory card, cop claims “It must have fallen on the ground”
Paul Joseph Watson
October 1, 2012
Despite the TSA admitting on its own website that there is no law which prevents people from filming TSA checkpoints, a man traveling through San Juan airport in Puerto Rico had his camera confiscated and footage deleted.

Since the TSA deleted most of the video footage, this clip shows only the end of the incident.
Tom McCormack explains how he was repeatedly harassed by TSA officers and then police simply for filming at a body scanner checkpoint, before TSA agents violently grabbed his camera from him and disappeared, a concerning development given the fact that TSA workers are routinely caught stealing expensive personal items belonging to travelers.
The following account of the incident comes courtesy of the Pixiq website.
I was in the San Juan airport at noon (Sept 24) heading for St. Kitts.
I videotaped (Canon Power Shot) the podium where they make you show the passport/boarding pass, as I approached and then the next area with the X-ray scanners. It was busy. One TSA woman told me to stop from about 20 feet away. I didn’t.
They all seemed intrigued I wouldn’t follow their orders. A TSA guy soon approached me and said I had to stop. I kept the video going and said
“Sorry, it’s a Constitutional right.” He said “Okay” and walked back, a little indignant, to the X ray area.
When I went through X rays they were waiting for me. Two uptight TSA ladies rolled up on a cart and approached me. I grabbed my camera and started rolling; I wanted to capture the conversation with them.
One of them approached me and violently ripped the camera from my hands. I was shocked and told her to give it back and lunged for my camera. They took my camera and passport and boarding pass and ran off to some corner to confer with one another.
A police officer approached and asked where I was from. I said California. The conversation went like this:
Me: “I’m from California. Why?”
Him: “Well, each State has its own rules.”
Me: “But this is TSA. A Federal agency. Therefore the State laws don’t apply. Besides, the First Amendment of the Constitution trumps state rules.”
Him: “This is an airport. You can’t just videotape people. You need permission.”
Me : “Nonsense, this is a public arena. There is not permission required or any expectation of privacy here.”
Him: “No, Puerto Rico is not like the States. There are local laws that have nothing to do with the way they do things in the States.”
Me: “Look, let’s just agree to disagree. I don’t accept anything you say. I want my camera back. See stole it. I want her to give it back right now.”
Him: “She didn’t steal it. She just confiscated it because you violated the rules.”
The TSA lady reappeared with my camera, passport, boarding pass. I took it and started to walk away (pissed off) when I noticed the camera would not go on. I looked at the cartridge slot and it was gone. They had stolen it!
I showed the cop and said, “Look I want my cartridge (with 200 or so personal photos) back or I’ll call a lawyer and 911 to get more cops.
This is outrageous!” He seemed to be aware I was getting upset and the TSA ladies scurried off with the cop and came back 2 minutes later with the cartridge.
“It must have fallen on the ground” said the cop.
Yeah, right. Predictably all the videos of them giving me a hard time were deleted. The whole episode lasted about 10 minutes.
This story again reminds us that Americans are being harassed and in some cases arrested for filming either federal employees, in the case of the TSA, or police officers.

Sunday, September 30, 2012

When it costs more to be poor – Fed and government shifting inflation onto rent, medical care, and food. QE3 to widen the gap between the poor and the wealthy.

Editor's note: More evidence that the middle class is being destroyed, as I have talked about in many articles and videos. This is meant to destroy competition that would compete against the wealthy globalists, as well as being a control mechanism. 

September 30, 2012

Inflation has been picking up since the recession ended in 2009.  The problem with the CPI increasing year over year with no rise in household incomes is that the standard of living for most Americans erodes every year that incomes do not keep up.  Household incomes are back to levels last seen in the mid-1990s while the cost of necessities has gone up.  This brings us to our article today that examines the nuts and bolts of what constitutes the Consumer Price Index (CPI).  The CPI attempts to measure the changes in price for consumer goods and services.  Overall it did a very poor job of measuring the housing bubble because of the owner’s equivalent of rent metric.  Today, it is understating inflation because of the excess spending on “wants” that occurred in the 2000s has now shifted to spending on “needs” but is being dragged down by the amount of family spending on needed goods.  We will dig deep into this data but suffice it to say that the Fed is creating inflation in items most Americans actually need to live their daily lives and the burden on the poor is actually increasing.
Do not believe the talk that inflation is nonexistent
Even a one percent rate of inflation is troubling if incomes are stagnant or falling.  Since the recession has ended inflation has occurred even as measured by the CPI:
cpi year over year
Over this same timeframe, household incomes have remained stagnant and household net worth has fallen close to 40 percent.  Yet there is something more troubling in the actual data.  The inflation rate is actually being understated because Americans have shifted consumption from non-essential goods to actually seeing inflation in things that they actually need.  In the 2000s spending on wasteful items was rampant and much of it came because of the easy access to debt.  Yet with 100 million credit cards being yanked out of the system, this spending has fallen dramatically.  So where exactly is the inflation occurring?
Change in Family Spending: 2007 – 2011

family spending and inflation 2012
Source:  The Atlantic
This is a very important chart to examine.  What we find is that family spending has gone up on items that are daily needs.  The biggest change has occurred on medical insurance and rents.  The cost of rents going up has come thanks to the financial system allowing million of properties to be held off the market thus allowing prices to be pushed up as the population grows.  The price of rents going up isn’t a sign that incomes are going up but a troubling fact that Americans have to allocate more of their funding to housing.  Of course, this is hitting working, middle class, and younger Americans hardest who actually do not own a home.
Next you have the bubble in higher education raging.  Students are taking on incredible levels of debt to support their educational pursuits.  No other generation has had to face so much debt with such a minefield of scam artist institutions that basically have millionaire presidents and are one step above a paper mill.  Yet thanks to easy government loans and banking lobbyist in cahoots with these institutions, the ultimate bill is passed on to taxpayers and those taking on the loans.  It is sophisticated way to launder money under the guise of helping Americans.  The quality checks are removed like selling a car for cheaper because it has no seat belts or brakes.  It also waters down degrees from quality institutions as more subpar degrees flood the market.
Finally you have an increase in the price of telephone service and foods.  The only item that has increased that might be considered a luxury is in the telephone category.  Yet food is an absolute necessity.  If we break down the CPI weighting we find the following:
cpi weighting broken out
Food and housing are the biggest line items.  However because mortgage spending has fallen thanks to the Federal Reserve and Americans spending less on home furnishing and vehicle purchases the CPI is not reflecting the big changes occurring.  A 15+ percent increase in rent from 2007 to 2011 with no increase in income is sizeable.  Yet the items where family spending has fallen is largely elective.  So when we look at family spending and then look at the CPI, you can understand why the increase in inflation seems modest yet most Americans are feeling the pinch to their wallets much tighter.
This is why the Federal Reserve through QE 3 and massive amounts of mortgage backed security purchases is essentially robbing from Peter to pay Paul.  The end result is that you have shifted more of a burden to renters to essentially take off a bit of steam from home owners.  Now you have major private equity investors buying properties and hiking rental prices since they are able to borrow money cheaply.  In all reality you have shifted a larger burden on those least likely to have the means to afford it.  This is why we have seen the middle class shrink in the last few decades and the ranks of the poor grow even larger.  With over 46 million Americans on food stamps we really are becoming a split nation.  And again, refer to the chart above on family spending.  With the rise in the cost of food you are squeezing the lowest rung even further.  Yet this is the setup of the current system.  The Fed is picking winners at the expense of others.  This is what occurs when you have manipulated money creation and coddling the banking sector versus actual real growth in the economy.  When you see those headlines about inflation figures keep all this data in mind.

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