What Hank "The Hammer" Paulson has accomplished this week is something that Barack Hussein "The One" Obama could never have even dreamed of: he has executed the most massive transfer of wealth that this world has ever seen.
Hank has robbed from the rich and given to the poor without levying a single tax dollar or firing a single bullet! Now, you say, "Hold on!" Hank has just saddled every man, woman, child, and unborn with thousands of dollars of taxes against future income, and he has unleashed some new horrific neo-socialistic order on the United States of America. But wait! What you are missing, and what the media is missing, and what
BOTH Liberal and Conservative bloggers are missing is that Hank has just dropped
napalm on the entire hedge fund industry in the name of jacking up the value of every 401K and restoring trust to banks and brokers so that Joe 401k Public does not put them out of business with a series of panic withdrawals.
Let me explain. Hedge funds make money using leverage and short-selling. If hedge funds merely bought stocks and bonds, they would be mutual funds. Also, hedge funds can only be owned by so called
accredited investors which is a technical term for millionaires. If there is anyone benefiting from a falling stock market, it is the hedge fund operators. Hedge funds have grown to over
$1 TRILLION in assets in just the past five years, and all those ultra-greedy and rich people who made money during this
CREDIT BUBBLE plowed a good chunk of it right back into hedge funds. So by blowing up this
HEDGE FUND BUBBLE, in effect, Hank Paulson is returning this wealth back to Joe 401K.
The only problem is that Joe 401K can only exploit this wealth transfer by
SELLING STOCK. Even Jim Cramer is advising everyone to sell off 20% of their stock holdings.
GENIUS?Barack Obama on the other hand wants to raise income taxes on the wealthy, raise capital gains taxes, and raise taxes on businesses large and small. The problem with this method of robbing the rich is that it gives the rich too much time to figure out ways
NOT TO PAY THE GOVERNMENT. The rich are rich for a reason. They know how to not pay taxes. Under the Obama regime, income would
DECREASE!. Jobs would become scarcer, pay would stagnate, and GDP would actually go down resulting is less wealth for Joe 401K both in investment gains and employment income.
The rich would simply figure out ways to collect income overseas, resulting in massive wealth transfers and a dramatically weaker dollar. They would also find ways to enrich themselves without declaring it as income. I don't know how they would do this, but with their armies of accountants and lawyers, they would find a way.
In other words, the Obama plan simply won't work, and will leave Joe 401K in a worse situation than where he began, even though he would receive $1000 in the mail from the Federal Government.
In conclusion, Hank "The Hammer" Paulson is my hero for accomplishing a massive redistribution of wealth from the ultra-greedy to the middle class, and establishing a plan that will ultimately benefit the entire country with little in the way of taxpayer liability. More on how this will work later.
