Putting The GINI Back In The Bottle: GINI Coefficient Keeps Rising While Real Income Falls

Confounded Interest ^ | 11/28/2013 | Anthony B. Sanders

[whitedog57]

Government policies including the Fed monetary expansion have seeming made matters worse for the average American family. Particularly since 2007.

The GINI coefficent is a measure of income distribution in country. And it has been skyrocketing since 2007 when Democrats took control of Congress and 2009 when they achieved a majority in both the House and Senate AND the Presidency. But for all the talk of income redistribution and “leveling the playing field,” things have only gotten worse for the average American household.

Here is the GINI coefficent for the USA since 2005. Note the decline from 2006 to 2007, and then the rapid increase from 2007 through 2012 (2013 is not available yet).

ginicoef2005

Let’s look at the GINI coefficient and real median household income (also available only through 2012). Of course, real median household income falls after each recession and the GINI coefficient worsens after each recession. But the Great Recession created the largest spread between income distribution and real income. In other words, the rich got richer and everyone else lost ground.

giniinc

Of course, the Federal Reserve stepped in during late 2008 to save the banking system from failure attempt to stimulate growth by lowering interest rates (and increase employment). Well, it looks like The Fed did help the GINI coefficient (that is, make income even more unbalanced).

ginifed

And as of 2012, real median household income continues to plunge as the Fed Balance Sheet continues to expand.

fedbalrealmedinmc

The good news is that real income is slowly increasing in 2013. And the rise in the GINI coefficient seems to be slowing.

household-income-monthly-median-since-2000 (5)

The housing bubble and crash clearly decimated the income and wealth of the middle class in the US. And government policies and Fed monetary easing seem to be making the problem worse.

Can we put the GINI back in the bottle and have lower and middle class growth again? Massive government intervention to “save” the economy has resulted in even greater distortions in income and wealth.

Let’s try something else … like LESS government.

[whitedog57]

More government = less middle class wealth

[pallis]

Big government is the greatest evil on earth, and it doesn’t matter how it comes about, Communism, Fascism, a king, a dictator or Democracy. Once governments become powerful and big enough to control everything, to control all the wealth, they need to be overthrown, one way or the other.

[Jack Hydrazine]

Albert Edwards: ‘Investors Demand A Sign Of When To Get Out And That Trigger May Have Just Arrived”
http://www.zerohedge.com/news/2013-11-27/albert-edwards-investors-demand-sign-when-get-out-and-trigger-may-have-just-arrived

[genghis]

just an addendum
how many 70 year old billionaires give all their wealth for a 24 year old body?
We are all the same
we have 1440 minutes each day to achieve our goals, choose wisely.