Saturday, April 13, 2013

The Next Bubble, Income Inequality

One of the most disturbing trends in this country is the rise of extreme wealth and income inequality.  One publisher, BusinessInsider.com, described it as 3 million overlords and 300 million serfs.  The situation is a classic bubble scenario that will potentially erupt in real class warfare, not just verbal clashes.  If you look at charts of corporate profits as a percentage of GDP vrs Wages, they are moving in different directions, and now are at historical extremes.

What could change it?  Maybe a revelation in Corporate thinking that recognizes that their employees are also customers, and the customers, (employees) won't buy goods if they're broke.  Don't hold your breath.  The accumulation of wealth in the 1% at the expense of the rest is a spring tightening, that will ultimately break with unknown consequences.

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