Wall Street vs. Main Street. 11/07/08

(Copyrighted)

Please don’t be fooled by the Wall Street analysts (who are after nothing but money and do not care what happens to you and I) and bad management of the Government.

Although what happens in the Main Street directly affects Wall Street, but the other way around is not as influential.  Let’s see why.

Wall Street:  It is a place where a group of rich people (buy and sell stocks, hedge, or … lots of technical terms) are making or losing money off the actual transactions or trades of stocks, bonds, commodity (oil, sugar, orange, wheat, corn…)

Main Street:  Our economy, our house, grocery stores, other retail stores, restaurants, etc.  This is where you and I buy or sell goods and services and make or lose money.

Let’s simplify this.  The people who are involved in the stock market, bonds, commodities… , as well as, the government which is supporting and backing the rich (Stock Market-Wall Street), want you to believe that the Wall Street is the back bone of the economy and without it, you and I should just dig a whole in the ground, lay down and wait for our death.  So, what where people doing for the past thousands of years until the 1930s when there was no stock market?

Hey, folks, that’s is not how it works.  The problem and financial stress starts at the “Main Street” (where you and I are located) before it impacts the “Wall Street”.  Allow me to give you a couple of examples to bring the logic of how it works to your attention.

Please forgive me of remind you about the 9/11.  The day of the horror, the “Wall Street” and other related markets crashed.   They were shut down/closed for several days, so that they would not go into the “FREE-FALL”  Then, to help the situation, Greenspan (Ex-Chair of Federal Reserve Bank-a for profit <non-government> institution) immediately dropped the lending rate by 1%, thinking that it will stop the market free fall.  It did help a bit in a manner that the next day the “Wall Street” opened, instead of free fall, it came down a bit for the next few days and Greenspan continued on his rate cut until Wall Street stopped falling and started heading upward.  It was not that long ago.  What happened to the Main street?  Did you pay more for gas prices immediately after 9/11?  Did you pay more for food and any other needs in your life?  Did you lose your job because of 9/11?  NO. No. No.

Wall Street collapsed because of the bad news.  Your life continued without any problems or intruption.  No price hike, no job losses due to 9/11 impact or economical changes.  The economical changes came when Mr. Bush decided to do other things to make the economy worse and then impacted our personal income which then impacted out buying power and then caused the companies not make as much money and finally laid off workers because there was no money to spend (go around). 

Besides the above paragraph.  The company stocks, commodity and bonds mostly drop or gain due to news.  A political/governmental news will make all these changes.  However, as far as Wall Street – for the stock prices to take TRUE changes, first Main Street is impacted before the stock prices.  Let’s see why?

A company reports higher than normal sells and profit (earning); because you and I bought more of its product or services.  As a result of our money (Main Street), the price of the stock for that company goes up (possibly even through the roof) –that’s Wall Street.  Next quarter (3 months later), we all stop using this company’s products and services (Main Street losses) and the company reports terrible earning; therefore, stock price falls to the ground (Wall Street).

Now would you please tell me this.  Why is the government concentrating on saving Wall Street (the stock prices) when the main street is in chaos?  That’s pure stupidity.  Yet the government officials (Treasury, Labor, Bush) and the bank (Federal Reserve) can not make up their mind what they want to do YET.

As I have been writing articles about “You need Robin Hood”, “Tax-payers-You are screwed no matter what!” the government is spending your tax dollars for the CEO of the companies to have larger paycheck, while you lose your home, can NOT afford paying bills or provide for your families.  

With love and best wishes,

Mike Samadi

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