Why most of us are poor, except for the really really rich

All of the pieces of the puzzle are slowly coming together as I read bits and pieces here and there attempting to explain why we are all poor now. The simplistic (and incorrect) answer is that too many people bought houses that they could not afford. So, dang it, they deserve to be strung up and crucified; therefore they should be happy to be alive and scraping cheese off the sidewalk for their evening meal. But why do the rest of us have to suffer for their failings, we bought a sensible mortgage and are making proper payments.

O.K., this is where is gets confusing. And deliberately so. If you keep the real explanation as complicated as possible, and muddle peoples' minds with elaborate nonsensical banking terms, their brains will explode in confusion and they will keep chattering about those dang people who bought houses that they could not afford.

Basically, what happened was banks started making up ways to use our money to get more money from really really rich people. They starting bundling mortgages in groups and issuing "insurance" policies to speculators (the really really rich people) who would pay a small premium. Basically, the speculators were betting that the mortgages would fail. The banks wanted more and more mortgages for bundling so they could keep getting those small premiums, so they didn't care about buyer qualifications. The banks thought the really really rich people were suckers and kept stashing all those small premiums in their pockets. Meanwhile the speculators hired experts who determined that there was no way the real estate market could sustain all those mortgages and predicted the bubble would burst. When all the mortgages started failing, the banks had to divvy up MILLIONS to pay the speculators, who then became really, really, REALLY rich people. The banks basically stole our money to pay off a make-believe debt (and then got bailed out by us AGAIN through the government!!), a debt that provided nothing to us, the banks' investors.

I had to stop now, because I can sense eyes glazing over. That's the beauty of this whole business. No one understands it. The banks were bookies. Sea Biscuit in the fifth. All perfectly sanctioned by the government.

O.K., you can go back to American Idol, now. I think I'll do the Daily Jumble, myself.