Sunday, October 9, 2011

Occupy Wall Street Enters the Stage

On Friday, as the U.S. Bureau of Labor Statistics reported that unemployment remained at 9.1%, the Occupy Wall Street movement continued to gain momentum and expand across the country. While critics suggest it lacks a clear message (most early stage grassroots movements confront this challenge), its initial concerns are well understood: 1) “Wall Street”- known for obtaining government bailouts with minimal benefit to average citizens and 2) corporate profits - at a record high as U.S. wage growth stagnates and jobs are outsourced.
In addition to government debt and foreclosures issues, the U.S. socio-economic landscape also includes the following challenges:
  • High unemployment among the young - employment among 16-to-24-year-olds this past summer was 48.8%, the lowest on record (back to 1948),
  • a 15.1% poverty rate - the highest since 1993 and
  • a record-high 45.3 million citizens participating in the Supplemental Nutrition Assistance Program (aka food stamps). While media pundits jockey for attention and politicians position for effective fundraising, grass-roots organizations such as Occupy Wall Street will likely become more relevant.
Note: Well-known investor Jeremy Grantham, chief strategist at GMO (with $100 billion in assets) recently sharing a colorful perspective of Wall Street at a Council of Institutional Investors conference calling the financial sector “a blood sucker” which provides little economic value and accused bankers of “obfuscating and bamboozling” clients. Democracy is messy; it may get messier.

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