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Favorability of the Federal Reserve by Demographics
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The Ron Paul moment may not have passed. Perhaps after lying dormant for a decade it is poised to return with a vengeance:

Or perhaps having non-Democrats split and most of the left arrayed in opposition is too hostile an environment for the moment’s renaissance. If it’s not an idea whose time has yet come, it will. Things are going to get worse before they get better.

The Fed is the beating heart of the welfare-warfare state. Despite its existence rendering taxation as conventionally understood–on income, sales, imports, bequests–superfluous, the Overton Window on government spending is confined to whether or not said spending is worth raising taxes over. It shouldn’t be, but it is convenient for the financial classes that it is.

The last year, wherein much less than half of all federal government spending was funded through taxation, has forced the window open. The TreasureFed creates whatever it needs to fund whatever it wants to. The big banks get their hands on the new money first, for free, when its value is highest.

The dollars held by everyone else, the 99%, lose value on account of the total supply of money going up. Suppliers and retailers get grumbled at for steadily raising prices over time. They aren’t charging more in real terms, though. The dollar is just worth less. Out of necessity, average joes jump into the stock market to protect their modest savings. It is out of necessity because the Fed rewards them for doing so. That new money has to end up somewhere, and asset prices are a major destination.

That process is about to spin out of control, however, as price increases find their way into things that aren’t so benign for the financial system, like consumer goods, raw materials, and wages.

The monetarist playbook calls for raising interest rates in response, but the American economy is saddled with waaaay too much debt for that to be politically viable. Tens of millions of mortgages would go into default. The consumer economy would come to a screeching halt as borrowing for a car, a house, a living room set, a swimming pool, an education, and everything else became prohibitively expensive. The equity markets would plunge and with them boomer pensions and 401(k)s.

Instead, prices will rise. Last month’s four decade record-setting inflation figures will not be a one-off thing. They are the beginning of a painful process that will see the dollar dethroned and the American monetary standard of living decline.

This will revivify the sentiments fueling phenomena like the Tea Party and Occupy Wall Street, and this time the anger and frustration will be much worse, concordant with how much worse the economy is in the process of becoming.

The Establishment will respond by labelling Tea Party 2.0 as insurrectionist white supremacy and by demonstrating maximal Wokeness to defang Occupy 2.0 into obeisance. Don’t fall for it. It’s worth knowing who is to blame.

 
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  1. so like….remind us again how you aren’t A Crypto Guy?

    everything you just said is basically the core thesis driving Crypto Folks–most especially Bitcoiners, but Etherium and ‘DeFi’ folks who envision an entirely peer-to-peer economic system without banks, as well.

    • Replies: @Triteleia Laxa
    @BigDickBandit

    How will that economic system be protected from your own government?

    Replies: @dfordoom

    , @Catdog
    @BigDickBandit

    Crypto will become yet another tool of tyranny. Soon the feds will take what they've learned from bitcoin and create their own fedcoin. Every purchase will be tracked and auditable. Taxes will be deducted from your fedcoin account automatically. Wrongthinkers will have their assets frozen. I don't like it.

    Replies: @Franz

    , @Alexander Turok
    @BigDickBandit

    If crypto threatened the powers that be, they'd just ban crypto, most like through burdensome regulation. You'd still be able to send it over the net to other gray marketeers, but good luck buying food, gas, housing, medicine, etc. with it.

    , @Audacious Epigone
    @BigDickBandit

    I love the idea and I want crypto to take the world by storm.

  2. Not surprising that Democrats are the segment most favorable to the Federal Reserve, since almost all of them are funded from it, directly or indirectly.

    • Agree: Thomasina
  3. @AudaciousEpigone : Can you recommend a book that explains well and in detail the evils of Central Banks, please?

    • Replies: @Audacious Epigone
    @Bartolo

    Rothbard's classic What Has Government Done to Our Money (it's free) is a great place to start.

    Replies: @V. K. Ovelund

    , @WorkingClass
    @Bartolo

    https://christianobserver.net/documents/creature-from-jekyll-island-by-edward-griffin.pdf

    This is the classic case against the FED in PDF.

    , @ThreeCranes
    @Bartolo

    Secrets of the Temple, How the Federal Reserve Runs the Country by William Greider (published 1989).

    https://www.amazon.com/Secrets-Temple-Federal-Reserve-Country/dp/0671675567

    "This ground-breaking best-seller reveals for the first time how the mighty and mysterious Federal Reserve operates—and how it manipulated and transformed both the American economy and the world's during the last eight crucial years. Based on extensive interviews with all the major players, Secrets of the Temple takes us inside the government institution that is in some ways more secretive than the CIA and more powerful than the President or Congress."

    Review
    The Nation May be the most important political book of the decade

    Washington Post Book World Masterful...Monumental...A virtuoso investigative history.

    The New York Times Book Review Breathtaking energy and research...

    San Francisco Chronicle Review Spectacular...A superb, riveting narrative of the development of the U.S. political economy...An informative primer on the origins and nature of money

    Columbia Journalism Review An awesome achievement...destined to rank as one of the half-dozen best dealing with the Reagan era...a splendid job of reporting...aggressive and insightful.

    The Wall Street Journal A gripping portrait of American economic civilization...brilliant author...wonderful book...

    Time Lucid and colorful...a historical and analytical work of impressive breadth and depth

    , @anon
    @Bartolo

    A few books that are off the beaten track may be useful to you. First of all, I suggest Fiat Money in France by Andrew White. It used to be a kind of hard to find book, but now there are many copies online in PDF. It was written by a 19th century man, so the style may be odd to you, but as a discourse on the Assignat paper of Revolutionary France (1789 onward) and the effects it created the book is excellent. Inflation? Hard assets? Economic warpage? It's all there, and White makes no secret what side he's on.

    Then I would suggest entertaining yourself with selections from Extraordinary Popular Delusions and the Madness of Crowds by MacKay. A 19th century work that documents among other things the Mississippi Bubble of France and the South Seas Bubble of England as well as the Dutch Tulip Mania, it does capture quite a bit of the flavor that manias induce. I re-read it during the housing bubble of 15 years ago, by the way. MacKay was a lawyer, so he just chronicled things he found interesting.

    For a view from the other side I would suggest Manias, Panics and Crashes by Thomas Kindleberger. I think there are PDF's as well, but you may prefer a hard copy. His bias should be obvious from his biography, and some find his book a bit slow going like a textbook, but he does extensively document in a narrative form a series of unfortunate economic events from the 17th century on. The US Panic of 1873 had its roots in the failure of Austrian banks much like US Savings & Loans, for example. Many of the canals built in the US in the 19th century were funded by bonds that ultimately reverted to a value of zero.

    Kindlberger's thesis boils down to what he views as a fact: in any economy, there must always be a lender of last resort, a lender that can buy and retire ("clear") debt instruments in all extreme circumstances. But the market participants universally must be perpetually in doubt as to whether that lender will actually come through or not; this should constrain their worst tendencies.

    One detail that Kindleberger doesn't really discuss much, probably due to his pro-central-bank prejudice, is important: the US got along ok for most of the 19th century and the first decade of the 20th century with no central bank at all. Jackson's demolition of the Bank did not lead to doom as expected. In fact, one could read Kindleberger and note that the absence of a visible lender-of-last-resort may have constrained market players more than he wished to admit.

    Tangent...
    In my opinion, both the roaring 20's and the 30's Depression resulted from the US Federal Reserve Bank trying out its powers on the post WW I recession. Few know it, but the peace of 1918-1919 brought big economic dislocation to even the safe US, with millions thrown out of their war industry jobs. The trains were covered with men riding the rails to find work. Fooling around with the money supply led to a huge expansion in the 1920's, and as always that party was followed by the hangover in the 1930's. Washing away that debt and dealing with poor economic choices took up years; years longer than it should have, because the newly powerful DC players had to try to micromanage.

    Replies: @Thomasina

  4. We are speeding towards a collision with reality. In order for fiscal stimulus to work there has to be enough capacity in the economy to absorb the additional money the government hands out. All well and good for Joe Biden to demand we drive EVs but EVs require lots of copper and lithium and enough electricity supply to charge them. What’s going to happen this summer in California when the wildfires start. Those rooftop solar panels don’t work so well when there is a smokey haze blocking out the sun and PG&E has to turn their transmission lines off. Lots of Tesla owners are going to be in the same situation regular drivers where in when hackers turned off the Colonial gasoline pipeline. Running on empty!

    Everywhere you look our supply chains are falling apart. A cracked steel beam on a key bridge over the Mississippi snarled road and river transit. A giant containership blocks the Suez canal. Taiwan is going into a Covid lockdown so where do we source the microships the auto industry desperately needs? Restaurants want to reopen but can’t hire workers. Airlines want to resume flying but have no destinations that accept international travelers. Japan has wasted billions on an Olympics that won’t be. Texas showed us how ‘reliable’ windpower is as people froze in their homes last winter. As Congressman Jim Trafficant used to howl on the floor of Congress “Beam me up Scotty”

    • Replies: @Liberty Mike
    @UNIT472

    We could sure use a few men like the late, great Jim Trafficant.

  5. How many ordinary people have the remotest idea what the Federal Reserve actually is and what it does? How many ordinary people are capable of having an informed opinion on the subject?

    It would be like asking ordinary people for their opinion of some abstruse theory in astrophysics.

    Democrat supporters presumably like the Fed because they think it’s part of the government, and government is a good thing (a good thing at the moment anyway, since the Democrats control it).

    Republican supporters presumably like the Fed because they think it’s part of the government, and government is a bad thing (a bad thing at the moment anyway, since the Democrats control it).

    For most ordinary people the only sensible answer they could give on most complex issues is, “I don’t have a clue.” And they should probably amplify this to, “I don’t have a clue and I can’t spare ten years of my life to study the subject in depth.”

    • Replies: @neutral
    @dfordoom


    It would be like asking ordinary people for their opinion of some abstruse theory in astrophysics.
     
    This is nonsense, what the reserve bank of any country does is not the hardest thing to grasp. Sure there is a lot of big sounding words thrown in, but that is a built in feature to obfuscate, not because this subject matter is equivalent to advanced mathematics. The reserve banks, like a lot of "democracies", are primarily under the sway of the super rich, all decisions on what interest rates should be are ultimately determined how it benefits the super rich. Unless of course you sincerely believe they would follow their dry statistics to enact something that would not be good for the super rich, and if you actually believe this then point out anywhere and any time this has ever happened?

    Replies: @TomSchmidt

    , @Liberty Mike
    @dfordoom

    You don't have much regard for the average mate.

    Replies: @dfordoom

  6. […]a painful process that will see the dollar dethroned and the American monetary standard of living decline.

    This will revivify the sentiments fueling phenomena like the Tea Party and Occupy Wall Street, and this time the anger and frustration will be much worse, concordant with how much worse the economy is in the process of becoming.

    A discordant and impoverished population is also exceedingly easy to dupe into fighting foreign wars for a living wage, which fed stakeholders are simply constrained to attempt as a last ditch defibrillation.

  7. Trump missed an opportunity during his presidency. Whites without college degrees in the Rust Belt extending from western Pennsylvania to Wisconsin had abandoned the Democrats in 2016 because the Democrats approved of Federal Reserve policies that benefited the rich and government workers, many of whom now have college degrees and have been thoroughly indoctrinated while in college in the woke leftism the Democrats also support.

    This caused the loss of Pennsylvania, Michigan and Wisconsin by the Democrats in 2016 and caused Trump to win. Once in office, however, Trump then became a cheerleader for these same policies. For example, in August 2019 Trump tweeted that Jerome Powell, chair of the Fed, was a bigger enemy of the U.S. than the president of China because he wasn’t immediately caving in to Trump’s demand that interest rates be lowered.

    This and his pandering to blacks with his Platinum Plan caused him to do worse with white working class voters, who make up over forty percent of the voters, in these three states and caused the loss of all three and thus the election in 2020. Instead of outreach to expand his base, he should have been engaging in trying to keep the voters who won him the election in 2016 and that would include ending the Fed policies that harm them. Trump wouldn’t admit he made a mistake here and tried to blame his loss entirely on voter fraud. While voter fraud was most likely a factor, it wasn’t the only factor and Republicans need to learn from Trump’s mistakes and adopt more of a Ron Paul attitude towards the Fed.

    • Agree: Pop Warner
    • Replies: @TomSchmidt
    @Mark G.

    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA. If ballots cast in contravention to existing state law were tossed out, Trump wins WI and PA. Trump continued to do well with white working class voters despite not doing much for them.

    He lost middle and upper middle class white male support. Banning critical race theory late in 2020 was too little, too late for that group whom he might have won by a larger margin. Bragging about the bubble market did not impress them. Imagine that.

    Replies: @Mark G.

    , @JohnPlywood
    @Mark G.

    You're delusional. Trump lost because white males largely abandoned conservatism and this kind of paranoid schizophrenic though process. Look it up, self-identified conservatives dropped 10% in late 2020. White males are going woke, because the right wing is broke.

  8. Once in office, however, Trump then became a cheerleader for these same policies. For example, in August 2019 Trump tweeted that Jerome Powell, chair of the Fed, was a bigger enemy of the U.S. than the president of China because he wasn’t immediately caving in to Trump’s demand that interest rates be lowered.

    This and his pandering to blacks with his Platinum Plan caused him to do worse with white working class voters, who make up over forty percent of the voters, in these three states and caused the loss of all three and thus the election in 2020.

    I was aghast at Trump’s pro-bubble rhetoric. I recall Hillary saying: “why would you vote for Trump? He will cause your 401ks to go down.” I thought: Hillary, the median retirement savings in America is $5000. Half the people have nothing, basically, and don’t care. Those people voted Trump, I’ll wager.

    Then Trump spends 2020 bragging about the stock market. He lost the upper middle class whites because he did too little to offset CRT to benefit them, and the D’s were fine on the stock market.

    It was incredible to see.

    • Agree: Audacious Epigone
    • Replies: @Daniel H
    @TomSchmidt


    I was aghast at Trump’s pro-bubble rhetoric. I recall Hillary saying: “why would you vote for Trump? He will cause your 401ks to go down.”
     
    Some decades back Newt Gingrich and several other cucks were mouthing off that since the stock market had been doing so well the worker should be able to put his social security withholdings into the market, making for a better retirement account, because the market only goes up, and if it does go down you can buy on the dip etc....... The pure retardedness of that idea, and yet he was considered one of the intellectuals of the cucks. We have been so badly served.

    Replies: @TomSchmidt

  9. Inflation tax allows the US to tax world savings. Many economies are dollarized and much of the world’s reserves are in dollars.

    More troubling is that the US becomes degenerate by the huge deficit spending.

  10. You left out a critical piece of the puzzle supplied by the 2017 tax bill, AE. For a very long time, the DEMOCRATS had proposed changing the definition of inflation to Chained CPI. They never did.

    The 2017 tax bill adopted it, with no D votes. Heckuva job, Trumpie: now the R’s own it. What it does is understate inflation so that Social Security payments go up less, and so do “inflation indexed” tax brackets. In other words, less real money goes out, and more real money comes in because tax brackets don’t reflect true inflation. The tax rates matter far less.

  11. @Mark G.
    Trump missed an opportunity during his presidency. Whites without college degrees in the Rust Belt extending from western Pennsylvania to Wisconsin had abandoned the Democrats in 2016 because the Democrats approved of Federal Reserve policies that benefited the rich and government workers, many of whom now have college degrees and have been thoroughly indoctrinated while in college in the woke leftism the Democrats also support.

    This caused the loss of Pennsylvania, Michigan and Wisconsin by the Democrats in 2016 and caused Trump to win. Once in office, however, Trump then became a cheerleader for these same policies. For example, in August 2019 Trump tweeted that Jerome Powell, chair of the Fed, was a bigger enemy of the U.S. than the president of China because he wasn't immediately caving in to Trump's demand that interest rates be lowered.

    This and his pandering to blacks with his Platinum Plan caused him to do worse with white working class voters, who make up over forty percent of the voters, in these three states and caused the loss of all three and thus the election in 2020. Instead of outreach to expand his base, he should have been engaging in trying to keep the voters who won him the election in 2016 and that would include ending the Fed policies that harm them. Trump wouldn't admit he made a mistake here and tried to blame his loss entirely on voter fraud. While voter fraud was most likely a factor, it wasn't the only factor and Republicans need to learn from Trump's mistakes and adopt more of a Ron Paul attitude towards the Fed.

    Replies: @TomSchmidt, @JohnPlywood

    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA. If ballots cast in contravention to existing state law were tossed out, Trump wins WI and PA. Trump continued to do well with white working class voters despite not doing much for them.

    He lost middle and upper middle class white male support. Banning critical race theory late in 2020 was too little, too late for that group whom he might have won by a larger margin. Bragging about the bubble market did not impress them. Imagine that.

    • Replies: @Mark G.
    @TomSchmidt


    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA.
     
    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.

    The Constitution gave the role of certifying the election results to state legislatures. Since they are in charge of that they also need to be in charge of setting the procedures for how the voting is done and how the votes are verified as being accurate after the voting is over. Some of these decisions were made in the last election by state governors, the secretary of state for individual states and even city government officials. In any situation like this, the Constitution says it should have been the state legislature making the decision. Now that the election is over, the Democrat controlled Congress should not be taking over and trying to stop attempts to uncover voter fraud.

    Replies: @TomSchmidt, @Alexander Turok

  12. The dollars held by everyone else, the 99%, lose value on account of the total supply of money going up. Suppliers and retailers get grumbled at for steadily raising prices over time. They aren’t charging more in real terms, though. The dollar is just worth less. Out of necessity, average joes jump into the stock market to protect their modest savings. It is out of necessity because the Fed rewards them for doing so. That new money has to end up somewhere, and asset prices are a major destination.

    I say:

    AVERAGE JOES JUMP INTO THE STOCK MARKET?

    Where are they jumping and are they jumping from a higher diving platform and is there water in the pool and who is selling the stocks and perhaps a political candidate should harp like a bastard about the plutocrat billionaires and the ones with hundreds of millions of dollars and the nasty, money-grubbing White Upper Middle Class Snot Brats who round out the top ten percent of loot holders?

    Are computers and algorithms now to be known as “average joes” and perhaps the computers would like some sloppy joes for breakfast?

    An article in the Wall Street Journal says this:

    The wealthiest 10% of U.S. households own 88.5% of stocks, according to Fed data.

    Stocks have been artificially boosted by the outlandish and evil and duplicitous monetary extremist machinations of the privately-controlled Federal Reserve Bank and inflation-adjusted wages have fallen like a rock in a millpond and the plutocrats are laughing at the ripples.

    John Hilsenrath in the Wall Street Journal:

    Economists describe inflation as a regressive tax—meaning it hits low-income workers hardest. “I don’t see anything good happening from an economic inequality perspective,” said Karen Petrou, a financial analyst and author of “Engine of Inequality,” a critique of Fed policy. “Most American households are living hand to mouth.”

    Ms. Petrou said a decade of the Fed’s low-interest-rate policies have mostly helped the wealthy by pushing stocks higher. That effect has accelerated recently. While inflation-adjusted wages fell in April from a year earlier, the Dow Jones Industrial Average was up more than 40% over the same period. The wealthiest 10% of U.S. households own 88.5% of stocks, according to Fed data.

    https://www.wsj.com/articles/inequality-would-widen-if-u-s-policies-spur-sustained-inflation-11621173602

  13. @TomSchmidt
    @Mark G.

    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA. If ballots cast in contravention to existing state law were tossed out, Trump wins WI and PA. Trump continued to do well with white working class voters despite not doing much for them.

    He lost middle and upper middle class white male support. Banning critical race theory late in 2020 was too little, too late for that group whom he might have won by a larger margin. Bragging about the bubble market did not impress them. Imagine that.

    Replies: @Mark G.

    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA.

    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.

    The Constitution gave the role of certifying the election results to state legislatures. Since they are in charge of that they also need to be in charge of setting the procedures for how the voting is done and how the votes are verified as being accurate after the voting is over. Some of these decisions were made in the last election by state governors, the secretary of state for individual states and even city government officials. In any situation like this, the Constitution says it should have been the state legislature making the decision. Now that the election is over, the Democrat controlled Congress should not be taking over and trying to stop attempts to uncover voter fraud.

    • Replies: @TomSchmidt
    @Mark G.

    What do you expect if the AZ audit comes back and says that Trump won AZ? Or if he were awarded PA and WI? In PA, they clearly violated the election law in permitting ANY mail-in ballots; throwing all of those out would have flipped Congress, frankly. If fraud is demonstrated in AZ and GA, I don't expect Trump to be installed as President. Biden will serve until he dies, is replaced by Harris, or a new President is inaugurated in 4 years.

    Either way, I'm interested to see the result in AZ. If it fairly concludes the D's won it, I'll be as happy as if it concludes they stole it.

    , @Alexander Turok
    @Mark G.


    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.
     
    Same reason Trump was so eager to block the Mueller investigation.(And would have actually done so if he had some balls) People don't take too kindly to being accused of crimes based on nothing.

    Replies: @V. K. Ovelund, @Sick of Orcs

  14. The monetary extremist horse has been let out of the barn by the evil and demonic JEW/WASP Ruling Class of the American Empire and White Core America must hoist the ruling class turds with their own petard by calling for the privately-controlled Federal Reserve Bank to be NATIONALIZED and the currency doled out like ale close to the end of happy hour.

    This Is The End by the admiral’s son was fifty years too early, but we are soon to break on through to the other side of monetary madness in a binge of debt that will implode the dollar and all other currencies and it will render all debt and the proceeds derived from that debt null and void.

    White Core America will call for the immediate implementation of a Guaranteed Federal Reserve Bank Monthly Income to dole out the loot and the swag and eligibility will be the key to the whole patriotic plan. All of the foreigner invader interlopers of the last hundred years or so and their spawn will be ineligible to get their conjured up loot from the Fed.

    ELIGIBILITY for the swag cuts out the foreigner interloper invaders and it sets the stage for the political decapitation of the evil and treasonous JEW/WASP Ruling Class of the American Empire.

    I wrote this in August of 2020 about conceiving of UBI as a political weapon to dislodge the ruling class:

    UBI or the Pewitt Conjured Loot Portion(PCLP) is about raw power and who has it. A UBI or PCLP will allow the historic American nation or the European Christian ancestral core the ability to dislodge from power the evil and treasonous JEW/WASP ruling class from power.

    The Pewitt Conjured Loot Portion(PCLP) will pay each American who has all blood ancestry born in colonial America or the USA before 1924 a cool ten thousand dollars a month. The US Treasury and the Federal Reserve Bank shall work together to conjure up the cash out of thin air, just like the ruling class is doing now.

    Sam Francis said it’s all about the ruling classes and Sam was right. A UBI or PCLP will create the conditions whereby tens of trillions of dollars and land and property and licenses and other assets can be severed from the ownership and control of the current corrupt and illegitimate JEW/WASP ruling class members of the American Empire and doled out to the patriotic and honorable old stocker members of the European Christian ancestral core.

    UBI or PCLP is about raw political power; it’s not about economics.

    The ability to control the central bank is the true power and it must be contested by the old stocker members of the historic American nation.

    The Federal Reserve Bank must be nationalized and the JEW/WASP ruling class and its minions must be financially liquidated and its members must be forcibly exiled to a hot and humid and nasty part of sub-Saharan Africa. All this must be done legally, of course.

    William the Conqueror thought he got screwed out of his rightful inheritance, and the JEW/WASP ruling class of the American Empire is screwing over the decent and patriotic members of the old stocker historic American nation. Of course, horrible treasonous sleazebag old stockers like those in the Bush Organized Crime Syndicate are examples of old stocker evil globalizer treasonite ruling class nation-wreckers.

    Repudiate All Debt and Financially Liquidate The Plutocrats And Their Stooges.

    GOD BLESS AMERICA!

    https://www.unz.com/anepigone/shaking-the-money-tree/#comment-4134922

  15. I think you’re reading too much into this poll. Democrats hear the words “federal reserve” and think it’s a pure government agency. If you explained what it actually is, they’d be much more hostile.

    • Thanks: Audacious Epigone
  16. Central banks must be hammered like a Viking hammering some Saxon to pulp.

    Marine Le Pen of France has recently shown herself to be an electoral cohort baloney slicer by hedging and changing her position on the euro and the ECB and she believes she can peel away 5 percent or so from the Upper Middle Class and grab them from Macron by pandering to the money-grubbers.

    Trump started out hammering the Fed and the asset bubbles and then he ended his power by touting the Fed-induced asset bubbles.

    Perhaps Marine Le Pen will win the French presidency by downplaying the euro currency and central bank questions and we shall see but any Republican Party presidential aspirant should get right with Whites Without a College Degree by going full bore ANDREW JACKSON and campaigning on making the Federal Reserve Bank work directly for regular Whites by cutting out the shyster middlemen and stopping the laundering of electronically conjured up loot through the Finance, Insurance and Real Estate(FIRE) scam sector. Send the electronically conjured up loot directly to all eligible Americans and be done with it.

    We are not going back to a gold standard and we are not quitting the empire business cold turkey. But we can begin directly doling out electronically conjured up cash to eligible Americans and we can go to an offshore regional balancer foreign policy strategy.

  17. @Mark G.
    Trump missed an opportunity during his presidency. Whites without college degrees in the Rust Belt extending from western Pennsylvania to Wisconsin had abandoned the Democrats in 2016 because the Democrats approved of Federal Reserve policies that benefited the rich and government workers, many of whom now have college degrees and have been thoroughly indoctrinated while in college in the woke leftism the Democrats also support.

    This caused the loss of Pennsylvania, Michigan and Wisconsin by the Democrats in 2016 and caused Trump to win. Once in office, however, Trump then became a cheerleader for these same policies. For example, in August 2019 Trump tweeted that Jerome Powell, chair of the Fed, was a bigger enemy of the U.S. than the president of China because he wasn't immediately caving in to Trump's demand that interest rates be lowered.

    This and his pandering to blacks with his Platinum Plan caused him to do worse with white working class voters, who make up over forty percent of the voters, in these three states and caused the loss of all three and thus the election in 2020. Instead of outreach to expand his base, he should have been engaging in trying to keep the voters who won him the election in 2016 and that would include ending the Fed policies that harm them. Trump wouldn't admit he made a mistake here and tried to blame his loss entirely on voter fraud. While voter fraud was most likely a factor, it wasn't the only factor and Republicans need to learn from Trump's mistakes and adopt more of a Ron Paul attitude towards the Fed.

    Replies: @TomSchmidt, @JohnPlywood

    You’re delusional. Trump lost because white males largely abandoned conservatism and this kind of paranoid schizophrenic though process. Look it up, self-identified conservatives dropped 10% in late 2020. White males are going woke, because the right wing is broke.

  18. @BigDickBandit
    so like....remind us again how you aren't A Crypto Guy?

    everything you just said is basically the core thesis driving Crypto Folks--most especially Bitcoiners, but Etherium and 'DeFi' folks who envision an entirely peer-to-peer economic system without banks, as well.

    Replies: @Triteleia Laxa, @Catdog, @Alexander Turok, @Audacious Epigone

    How will that economic system be protected from your own government?

    • Replies: @dfordoom
    @Triteleia Laxa


    How will that economic system be protected from your own government?
     
    Agreed.

    An economic system that seeks to bypass the banks will be crushed by the government in order to protect the banks.

    Anything that is a threat to the banks will be crushed. Including crypto.

    Crypto seems more and more likely to turn out to be a libertarian fantasy.
  19. @Mark G.
    @TomSchmidt


    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA.
     
    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.

    The Constitution gave the role of certifying the election results to state legislatures. Since they are in charge of that they also need to be in charge of setting the procedures for how the voting is done and how the votes are verified as being accurate after the voting is over. Some of these decisions were made in the last election by state governors, the secretary of state for individual states and even city government officials. In any situation like this, the Constitution says it should have been the state legislature making the decision. Now that the election is over, the Democrat controlled Congress should not be taking over and trying to stop attempts to uncover voter fraud.

    Replies: @TomSchmidt, @Alexander Turok

    What do you expect if the AZ audit comes back and says that Trump won AZ? Or if he were awarded PA and WI? In PA, they clearly violated the election law in permitting ANY mail-in ballots; throwing all of those out would have flipped Congress, frankly. If fraud is demonstrated in AZ and GA, I don’t expect Trump to be installed as President. Biden will serve until he dies, is replaced by Harris, or a new President is inaugurated in 4 years.

    Either way, I’m interested to see the result in AZ. If it fairly concludes the D’s won it, I’ll be as happy as if it concludes they stole it.

  20. @BigDickBandit
    so like....remind us again how you aren't A Crypto Guy?

    everything you just said is basically the core thesis driving Crypto Folks--most especially Bitcoiners, but Etherium and 'DeFi' folks who envision an entirely peer-to-peer economic system without banks, as well.

    Replies: @Triteleia Laxa, @Catdog, @Alexander Turok, @Audacious Epigone

    Crypto will become yet another tool of tyranny. Soon the feds will take what they’ve learned from bitcoin and create their own fedcoin. Every purchase will be tracked and auditable. Taxes will be deducted from your fedcoin account automatically. Wrongthinkers will have their assets frozen. I don’t like it.

    • Agree: Triteleia Laxa, dfordoom
    • Replies: @Franz
    @Catdog


    Crypto will become yet another tool of tyranny. Soon the feds will take what they’ve learned from bitcoin and create their own fedcoin.
     
    If they don't mug the cryptocurrency you've already earned:

    IRS found a new way to go after US crypto users --

    https://www.bitcoininsider.org/article/113220/irs-found-new-way-go-after-us-crypto-users

    Will the IRS Come After Your Bitcoin Soon? --

    https://www.investopedia.com/tech/bitcoin-irs-taxes/

    Satan never sleeps, like our old preacher used to say.
  21. The Fed is the beating heart of the welfare-warfare state.

    It won’t be beating much longer. There is not much left to steal.

  22. Monetary policy and ruling classes and demography and debt and globalization and financialization and mass immigration and multiculturalism and foreign policy: if a politician ain’t talking about those subjects it’s because the politician whore was bought off by treasonous donors to not talk about them.

    I wrote this in October of 2019 about monetary policy and inter-generational treason:

    If you ain’t talking ruling classes and monetary policy and demography you ain’t talking about what needs it.

    The JEW/WASP ruling class of the American Empire has demographically weaponized mass legal immigration and mass illegal immigration in order to attack and destroy the European Christian ancestral core of the USA.

    The JEW/WASP ruling class of the American Empire has used monetary extremism — zero/low interest rates, asset purchases, dollar swaps, debt(private/government)…etc. — to create asset bubbles in stocks, bonds and real estate. White Americans born before 1965 have been the biggest beneficiary of the asset bubbles in stocks, bonds and real estate.

    The JEW/WASP ruling class of the American Empire used the asset bubbles created by the privately-controlled Fed to bribe White Americans born before 1965. The reason that White Americans born before 1965 kept their greedy mouths shut about nation-wrecking mass legal immigration and mass illegal immigration was that they have been bought off with the asset bubbles created by monetary extremism.

    The Republican Party Must be Destroyed!

    White Core America Rising!

    https://www.unz.com/isteve/the-nyt-is-shocked-shocked/#comment-3532904

  23. “There is not much left to steal.”

    I wonder. Biden’s stealing Pharma’s vaccine patents might portend more stealing of private property to come. Why didn’t Biden use eminent domain? Isn’t that how it always has worked when the government needs to acquire private property? The government has to pay a fair price. This is a slippery slope.

  24. @UNIT472
    We are speeding towards a collision with reality. In order for fiscal stimulus to work there has to be enough capacity in the economy to absorb the additional money the government hands out. All well and good for Joe Biden to demand we drive EVs but EVs require lots of copper and lithium and enough electricity supply to charge them. What's going to happen this summer in California when the wildfires start. Those rooftop solar panels don't work so well when there is a smokey haze blocking out the sun and PG&E has to turn their transmission lines off. Lots of Tesla owners are going to be in the same situation regular drivers where in when hackers turned off the Colonial gasoline pipeline. Running on empty!

    Everywhere you look our supply chains are falling apart. A cracked steel beam on a key bridge over the Mississippi snarled road and river transit. A giant containership blocks the Suez canal. Taiwan is going into a Covid lockdown so where do we source the microships the auto industry desperately needs? Restaurants want to reopen but can't hire workers. Airlines want to resume flying but have no destinations that accept international travelers. Japan has wasted billions on an Olympics that won't be. Texas showed us how 'reliable' windpower is as people froze in their homes last winter. As Congressman Jim Trafficant used to howl on the floor of Congress "Beam me up Scotty"

    Replies: @Liberty Mike

    We could sure use a few men like the late, great Jim Trafficant.

  25. @dfordoom
    How many ordinary people have the remotest idea what the Federal Reserve actually is and what it does? How many ordinary people are capable of having an informed opinion on the subject?

    It would be like asking ordinary people for their opinion of some abstruse theory in astrophysics.

    Democrat supporters presumably like the Fed because they think it's part of the government, and government is a good thing (a good thing at the moment anyway, since the Democrats control it).

    Republican supporters presumably like the Fed because they think it's part of the government, and government is a bad thing (a bad thing at the moment anyway, since the Democrats control it).

    For most ordinary people the only sensible answer they could give on most complex issues is, "I don't have a clue." And they should probably amplify this to, "I don't have a clue and I can't spare ten years of my life to study the subject in depth."

    Replies: @neutral, @Liberty Mike

    It would be like asking ordinary people for their opinion of some abstruse theory in astrophysics.

    This is nonsense, what the reserve bank of any country does is not the hardest thing to grasp. Sure there is a lot of big sounding words thrown in, but that is a built in feature to obfuscate, not because this subject matter is equivalent to advanced mathematics. The reserve banks, like a lot of “democracies”, are primarily under the sway of the super rich, all decisions on what interest rates should be are ultimately determined how it benefits the super rich. Unless of course you sincerely believe they would follow their dry statistics to enact something that would not be good for the super rich, and if you actually believe this then point out anywhere and any time this has ever happened?

    • Agree: Charles Pewitt
    • Replies: @TomSchmidt
    @neutral

    someone had to say it. Well done.

  26. @dfordoom
    How many ordinary people have the remotest idea what the Federal Reserve actually is and what it does? How many ordinary people are capable of having an informed opinion on the subject?

    It would be like asking ordinary people for their opinion of some abstruse theory in astrophysics.

    Democrat supporters presumably like the Fed because they think it's part of the government, and government is a good thing (a good thing at the moment anyway, since the Democrats control it).

    Republican supporters presumably like the Fed because they think it's part of the government, and government is a bad thing (a bad thing at the moment anyway, since the Democrats control it).

    For most ordinary people the only sensible answer they could give on most complex issues is, "I don't have a clue." And they should probably amplify this to, "I don't have a clue and I can't spare ten years of my life to study the subject in depth."

    Replies: @neutral, @Liberty Mike

    You don’t have much regard for the average mate.

    • Replies: @dfordoom
    @Liberty Mike


    You don’t have much regard for the average mate.
     
    I don't think the average person is stupid. When it comes to day-to-day life the average person is reasonably intelligent and reasonable sensible. But when it comes to understanding complex issues most people just don't have, and can't possibly have, the necessary expertise and the necessary experience in those fields to understand those issues.

    You need a lot of specialised knowledge and expertise to understand the fiendish complexity of things like economic policy or foreign policy or or issues involving science or medicine. Only a very small number of people have that expertise.

    It's not a lack of intelligence. I consider myself to be reasonably intelligent but there is no way I could offer an informed opinion on Modern Monetary Policy. I'd have as much chance of doing that as I'd have of offering an informed opinion on abstruse theories in astrophysics. They're fields that (like the average person) I have never had the time or inclination to study in detail.

    A lot of people who hang out here are economics geeks and they just naturally assume that everybody is as fascinated by, and as learned in, those fields as they are.
  27. The Federal Reserve Bank Must Be NATIONALIZED

    Jebby Bush was a real estate agent in Florida at about the time the cocaine was flowing like water and the banks and the drug dealers needed to launder loot.

    And then later Jebby Bush touted a real estate asset bubble in Florida created by the Federal Reserve Bank and Jebby Bush was beaming with joy.

    Remember the sand states of Florida and Arizona and California and Texas and the belly up real estate bubble crash from a decade or more ago? Remember that the JEW/WASP Ruling Class of the American Empire deliberately created that real estate asset bubble to force more debt after the tech and NASDAQ bubble?

    Realize that the current asset bubble in stocks and bonds and real estate and just about everything else is twice as big as the previous two Fed-created asset bubbles combined.

    Mania and delirium and tip toeing through the Tulip Bubble and the Mississippi Bubble and now the asset bubble to end all asset bubbles is bubbling and the POP sound is achingly close and the greedy money-grubbing slobs will be howling with fury at the loss of their supposed wealth.

    HARK!

    Been here before has the bubbles.

    Tweets from 2015:

  28. and by demonstrating maximal Wokeness to defang Occupy 2.0 into obeisance. Don’t fall for it.

    There’s a reason wokeness was pushed with the Occupy crowd: many of them had already accepted many woke principles (white privilege, oppression, etc) before the movement was destroyed by it. These people were primed from the getgo for antiwhite beliefs from years of university education and media degeneration. I was learning about intersectionality before the Occupy protests ever began, and my liberal/leftist classmates swallowed it uncritically. It’s no surprise at all that banks took advantage of this to such great effect when it has been years in the making.

    My point is that the wokeists are not allies against banks. They will never take the position of the workers or anybody else since they are fully initiated into the new neoliberal pantheon. The most important (only) belief of leftists is that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated. There will be no anti-authority convergence between left and right because even the more skeptical leftists like Jimmy Dore ultimately accept the premises of BLM and other neo-religious organizations whose scripture proselytizes against the wicked white devil. Nowhere was this more evident than AOC’s response to Ted Cruz agreeing with her on policy, ignoring their agreement in favor of accusing him of trying to get her killed on 1/6.

    Do not expect any leftists to break the woke spell. Most are too far gone and will bootlick corporations and banks if they believe it hurts whites. They will cut out their own eyes if they believe it hurts whites. Telling them to not fall for wokeism is like telling a Christian to not fall for the resurrection. It is fundamental to their worldview and will never change, especially after four years of a man they legitimately believed to be a nazi white supremacist. The anticapitalists are now the most ardent defenders of capitalism because capitalism has turned against White Satan. And the power and influence they receive from participating in this cult is too great to throw away on something like principles.

    • Replies: @dfordoom
    @Pop Warner


    The most important (only) belief of leftists is that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated.
     
    Rubbish. Because people here at Unz are obsessed by race they assume that everybody else is as well.

    I'm a leftist and I certainly do not believe that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated.

    Most people (including leftists) go along with Wokeism because they feel they don't have any choice. Some leftists are True Believers in Wokeism. Some have very moderate opinions on the subject. Some leftists despise Wokeism.

    Replies: @Sick of Orcs

  29. @Bartolo
    @AudaciousEpigone : Can you recommend a book that explains well and in detail the evils of Central Banks, please?

    Replies: @Audacious Epigone, @WorkingClass, @ThreeCranes, @anon

    Rothbard’s classic What Has Government Done to Our Money (it’s free) is a great place to start.

    • Replies: @V. K. Ovelund
    @Audacious Epigone


    Rothbard’s classic What Has Government Done to Our Money (it’s free) is a great place to start.
     
    I am not asinine enough to call a book written by a man with a Ph.D. in economics “ill researched,” even if the book seems that way to me; but I can say that, for a classic, the book seems rather tendentious. An expert, Rothbard has earned the right to be heard. Hearing him, however, I am unimpressed.

    Where in the book does Rothbard seriously review the best arguments on the other side? The book hardly seems to rise even to the level of a polemic.

    Gold money might indeed be preferable to fiat, but Rothbard hardly seems interested in the question. He has already made up his mind.

  30. @TomSchmidt

    Once in office, however, Trump then became a cheerleader for these same policies. For example, in August 2019 Trump tweeted that Jerome Powell, chair of the Fed, was a bigger enemy of the U.S. than the president of China because he wasn’t immediately caving in to Trump’s demand that interest rates be lowered.

    This and his pandering to blacks with his Platinum Plan caused him to do worse with white working class voters, who make up over forty percent of the voters, in these three states and caused the loss of all three and thus the election in 2020.
     
    I was aghast at Trump's pro-bubble rhetoric. I recall Hillary saying: "why would you vote for Trump? He will cause your 401ks to go down." I thought: Hillary, the median retirement savings in America is $5000. Half the people have nothing, basically, and don't care. Those people voted Trump, I'll wager.

    Then Trump spends 2020 bragging about the stock market. He lost the upper middle class whites because he did too little to offset CRT to benefit them, and the D's were fine on the stock market.

    It was incredible to see.

    Replies: @Daniel H

    I was aghast at Trump’s pro-bubble rhetoric. I recall Hillary saying: “why would you vote for Trump? He will cause your 401ks to go down.”

    Some decades back Newt Gingrich and several other cucks were mouthing off that since the stock market had been doing so well the worker should be able to put his social security withholdings into the market, making for a better retirement account, because the market only goes up, and if it does go down you can buy on the dip etc……. The pure retardedness of that idea, and yet he was considered one of the intellectuals of the cucks. We have been so badly served.

    • Replies: @TomSchmidt
    @Daniel H

    If I might argue on behalf of Newt for a moment. Ending 25 years ago, a close associate of mine worked for a state government in a state that was not part of Social Security. This person made no more than $40,000 annually, but was enrolled in a "pension" plan where the state essentially set aside 18% of pay (including the 6.2% you pay for "Social Security", so it was 11.8% out of state budget on this) in a separate account. After working for four years at that institution and keeping the money invested in vanilla stock funds, I was recently made aware of the total amount of the account: about $200,000.

    Now, that money could have been put into Social Security and been worth... exactly nothing, as this person will get the maximum benefit for having worked for many years above the SS maximum. If you can safely draw down 4.5% of your assets, that is $9000 a year to start, or $750 a month. At a minimum the money lasts 22 years, and any balance remaining will go to heirs.

    So, done right, sure, it could have been a good idea. Done the way they've done it in Chile, as I've recently learned, the people running the system will skim from the little people.

  31. @Audacious Epigone
    @Bartolo

    Rothbard's classic What Has Government Done to Our Money (it's free) is a great place to start.

    Replies: @V. K. Ovelund

    Rothbard’s classic What Has Government Done to Our Money (it’s free) is a great place to start.

    I am not asinine enough to call a book written by a man with a Ph.D. in economics “ill researched,” even if the book seems that way to me; but I can say that, for a classic, the book seems rather tendentious. An expert, Rothbard has earned the right to be heard. Hearing him, however, I am unimpressed.

    Where in the book does Rothbard seriously review the best arguments on the other side? The book hardly seems to rise even to the level of a polemic.

    Gold money might indeed be preferable to fiat, but Rothbard hardly seems interested in the question. He has already made up his mind.

    • Thanks: TomSchmidt
  32. @Daniel H
    @TomSchmidt


    I was aghast at Trump’s pro-bubble rhetoric. I recall Hillary saying: “why would you vote for Trump? He will cause your 401ks to go down.”
     
    Some decades back Newt Gingrich and several other cucks were mouthing off that since the stock market had been doing so well the worker should be able to put his social security withholdings into the market, making for a better retirement account, because the market only goes up, and if it does go down you can buy on the dip etc....... The pure retardedness of that idea, and yet he was considered one of the intellectuals of the cucks. We have been so badly served.

    Replies: @TomSchmidt

    If I might argue on behalf of Newt for a moment. Ending 25 years ago, a close associate of mine worked for a state government in a state that was not part of Social Security. This person made no more than $40,000 annually, but was enrolled in a “pension” plan where the state essentially set aside 18% of pay (including the 6.2% you pay for “Social Security”, so it was 11.8% out of state budget on this) in a separate account. After working for four years at that institution and keeping the money invested in vanilla stock funds, I was recently made aware of the total amount of the account: about $200,000.

    Now, that money could have been put into Social Security and been worth… exactly nothing, as this person will get the maximum benefit for having worked for many years above the SS maximum. If you can safely draw down 4.5% of your assets, that is $9000 a year to start, or $750 a month. At a minimum the money lasts 22 years, and any balance remaining will go to heirs.

    So, done right, sure, it could have been a good idea. Done the way they’ve done it in Chile, as I’ve recently learned, the people running the system will skim from the little people.

  33. @Bartolo
    @AudaciousEpigone : Can you recommend a book that explains well and in detail the evils of Central Banks, please?

    Replies: @Audacious Epigone, @WorkingClass, @ThreeCranes, @anon

  34. @neutral
    @dfordoom


    It would be like asking ordinary people for their opinion of some abstruse theory in astrophysics.
     
    This is nonsense, what the reserve bank of any country does is not the hardest thing to grasp. Sure there is a lot of big sounding words thrown in, but that is a built in feature to obfuscate, not because this subject matter is equivalent to advanced mathematics. The reserve banks, like a lot of "democracies", are primarily under the sway of the super rich, all decisions on what interest rates should be are ultimately determined how it benefits the super rich. Unless of course you sincerely believe they would follow their dry statistics to enact something that would not be good for the super rich, and if you actually believe this then point out anywhere and any time this has ever happened?

    Replies: @TomSchmidt

    someone had to say it. Well done.

  35. @BigDickBandit
    so like....remind us again how you aren't A Crypto Guy?

    everything you just said is basically the core thesis driving Crypto Folks--most especially Bitcoiners, but Etherium and 'DeFi' folks who envision an entirely peer-to-peer economic system without banks, as well.

    Replies: @Triteleia Laxa, @Catdog, @Alexander Turok, @Audacious Epigone

    If crypto threatened the powers that be, they’d just ban crypto, most like through burdensome regulation. You’d still be able to send it over the net to other gray marketeers, but good luck buying food, gas, housing, medicine, etc. with it.

  36. @Mark G.
    @TomSchmidt


    Yes. There was clearly SOME voter fraud in 2020. Maybe enough to flip AZ and GA.
     
    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.

    The Constitution gave the role of certifying the election results to state legislatures. Since they are in charge of that they also need to be in charge of setting the procedures for how the voting is done and how the votes are verified as being accurate after the voting is over. Some of these decisions were made in the last election by state governors, the secretary of state for individual states and even city government officials. In any situation like this, the Constitution says it should have been the state legislature making the decision. Now that the election is over, the Democrat controlled Congress should not be taking over and trying to stop attempts to uncover voter fraud.

    Replies: @TomSchmidt, @Alexander Turok

    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.

    Same reason Trump was so eager to block the Mueller investigation.(And would have actually done so if he had some balls) People don’t take too kindly to being accused of crimes based on nothing.

    • Troll: WorkingClass
    • Replies: @V. K. Ovelund
    @Alexander Turok


    Same reason Trump was so eager to block the Mueller investigation.
     
    Trump didn't block the Mueller investigation. He complained about it. There is a difference.
    , @Sick of Orcs
    @Alexander Turok


    People don’t take too kindly to being accused of crimes based on nothing.
     
    The fastest way to prove innocence is to show and allow access to the evidence.

    Not a single corruptocrat has said, "Audit all you want, the evidence proves biden won."

  37. @Alexander Turok
    @Mark G.


    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.
     
    Same reason Trump was so eager to block the Mueller investigation.(And would have actually done so if he had some balls) People don't take too kindly to being accused of crimes based on nothing.

    Replies: @V. K. Ovelund, @Sick of Orcs

    Same reason Trump was so eager to block the Mueller investigation.

    Trump didn’t block the Mueller investigation. He complained about it. There is a difference.

  38. @Liberty Mike
    @dfordoom

    You don't have much regard for the average mate.

    Replies: @dfordoom

    You don’t have much regard for the average mate.

    I don’t think the average person is stupid. When it comes to day-to-day life the average person is reasonably intelligent and reasonable sensible. But when it comes to understanding complex issues most people just don’t have, and can’t possibly have, the necessary expertise and the necessary experience in those fields to understand those issues.

    You need a lot of specialised knowledge and expertise to understand the fiendish complexity of things like economic policy or foreign policy or or issues involving science or medicine. Only a very small number of people have that expertise.

    It’s not a lack of intelligence. I consider myself to be reasonably intelligent but there is no way I could offer an informed opinion on Modern Monetary Policy. I’d have as much chance of doing that as I’d have of offering an informed opinion on abstruse theories in astrophysics. They’re fields that (like the average person) I have never had the time or inclination to study in detail.

    A lot of people who hang out here are economics geeks and they just naturally assume that everybody is as fascinated by, and as learned in, those fields as they are.

  39. @Pop Warner

    and by demonstrating maximal Wokeness to defang Occupy 2.0 into obeisance. Don’t fall for it.
     
    There's a reason wokeness was pushed with the Occupy crowd: many of them had already accepted many woke principles (white privilege, oppression, etc) before the movement was destroyed by it. These people were primed from the getgo for antiwhite beliefs from years of university education and media degeneration. I was learning about intersectionality before the Occupy protests ever began, and my liberal/leftist classmates swallowed it uncritically. It's no surprise at all that banks took advantage of this to such great effect when it has been years in the making.

    My point is that the wokeists are not allies against banks. They will never take the position of the workers or anybody else since they are fully initiated into the new neoliberal pantheon. The most important (only) belief of leftists is that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated. There will be no anti-authority convergence between left and right because even the more skeptical leftists like Jimmy Dore ultimately accept the premises of BLM and other neo-religious organizations whose scripture proselytizes against the wicked white devil. Nowhere was this more evident than AOC's response to Ted Cruz agreeing with her on policy, ignoring their agreement in favor of accusing him of trying to get her killed on 1/6.

    Do not expect any leftists to break the woke spell. Most are too far gone and will bootlick corporations and banks if they believe it hurts whites. They will cut out their own eyes if they believe it hurts whites. Telling them to not fall for wokeism is like telling a Christian to not fall for the resurrection. It is fundamental to their worldview and will never change, especially after four years of a man they legitimately believed to be a nazi white supremacist. The anticapitalists are now the most ardent defenders of capitalism because capitalism has turned against White Satan. And the power and influence they receive from participating in this cult is too great to throw away on something like principles.

    Replies: @dfordoom

    The most important (only) belief of leftists is that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated.

    Rubbish. Because people here at Unz are obsessed by race they assume that everybody else is as well.

    I’m a leftist and I certainly do not believe that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated.

    Most people (including leftists) go along with Wokeism because they feel they don’t have any choice. Some leftists are True Believers in Wokeism. Some have very moderate opinions on the subject. Some leftists despise Wokeism.

    • Replies: @Sick of Orcs
    @dfordoom


    Because people here at Unz are obsessed by race they assume that everybody else is as well.
     
    "Everybody else" has no idea what tf is going on.

    The Great Replacement is easily quantifiable.

    Here's future Fraudsident biden dicksplaining Whites becoming a minority is a good thing.

    https://www.bitchute.com/video/gbPAuwo4lQTs/

  40. @Catdog
    @BigDickBandit

    Crypto will become yet another tool of tyranny. Soon the feds will take what they've learned from bitcoin and create their own fedcoin. Every purchase will be tracked and auditable. Taxes will be deducted from your fedcoin account automatically. Wrongthinkers will have their assets frozen. I don't like it.

    Replies: @Franz

    Crypto will become yet another tool of tyranny. Soon the feds will take what they’ve learned from bitcoin and create their own fedcoin.

    If they don’t mug the cryptocurrency you’ve already earned:

    IRS found a new way to go after US crypto users

    https://www.bitcoininsider.org/article/113220/irs-found-new-way-go-after-us-crypto-users

    Will the IRS Come After Your Bitcoin Soon?

    https://www.investopedia.com/tech/bitcoin-irs-taxes/

    Satan never sleeps, like our old preacher used to say.

  41. @Bartolo
    @AudaciousEpigone : Can you recommend a book that explains well and in detail the evils of Central Banks, please?

    Replies: @Audacious Epigone, @WorkingClass, @ThreeCranes, @anon

    Secrets of the Temple, How the Federal Reserve Runs the Country by William Greider (published 1989).

    “This ground-breaking best-seller reveals for the first time how the mighty and mysterious Federal Reserve operates—and how it manipulated and transformed both the American economy and the world’s during the last eight crucial years. Based on extensive interviews with all the major players, Secrets of the Temple takes us inside the government institution that is in some ways more secretive than the CIA and more powerful than the President or Congress.”

    Review
    The Nation May be the most important political book of the decade

    Washington Post Book World Masterful…Monumental…A virtuoso investigative history.

    The New York Times Book Review Breathtaking energy and research…

    San Francisco Chronicle Review Spectacular…A superb, riveting narrative of the development of the U.S. political economy…An informative primer on the origins and nature of money

    Columbia Journalism Review An awesome achievement…destined to rank as one of the half-dozen best dealing with the Reagan era…a splendid job of reporting…aggressive and insightful.

    The Wall Street Journal A gripping portrait of American economic civilization…brilliant author…wonderful book…

    Time Lucid and colorful…a historical and analytical work of impressive breadth and depth

  42. @Alexander Turok
    @Mark G.


    It does seem a tad suspicious that the Democrats are so eager to block an audit of the vote in Arizona. What are they worried about if there is nothing to find? Maybe our friend Corvinus will show up and explain it all.
     
    Same reason Trump was so eager to block the Mueller investigation.(And would have actually done so if he had some balls) People don't take too kindly to being accused of crimes based on nothing.

    Replies: @V. K. Ovelund, @Sick of Orcs

    People don’t take too kindly to being accused of crimes based on nothing.

    The fastest way to prove innocence is to show and allow access to the evidence.

    Not a single corruptocrat has said, “Audit all you want, the evidence proves biden won.”

  43. @dfordoom
    @Pop Warner


    The most important (only) belief of leftists is that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated.
     
    Rubbish. Because people here at Unz are obsessed by race they assume that everybody else is as well.

    I'm a leftist and I certainly do not believe that whites are inherently wicked and deserve to be dispossessed, disenfranchised, and ultimately exterminated.

    Most people (including leftists) go along with Wokeism because they feel they don't have any choice. Some leftists are True Believers in Wokeism. Some have very moderate opinions on the subject. Some leftists despise Wokeism.

    Replies: @Sick of Orcs

    Because people here at Unz are obsessed by race they assume that everybody else is as well.

    “Everybody else” has no idea what tf is going on.

    The Great Replacement is easily quantifiable.

    Here’s future Fraudsident biden dicksplaining Whites becoming a minority is a good thing.


  44. Reposting my comment from AE’s last outbreak of hard money doomerism: https://www.unz.com/anepigone/everything-is-going-up-because-the-dollar-is-going-down/#comment-4657168

    Reality check–the April surge in inflation was driven by a few categories which normally accounted for 13% of consumer spending and were impacted by reopening quirks: https://www.barrons.com/articles/dont-be-fooled-by-aprils-inflation-jump-its-being-driven-by-reopening-quirks-51620847392

    The April inflation surge may well be a temporary phenomenon driven by the very poor response to the pandemic and the global shortage of semiconductors. Some of the weird supply bottlenecks are fixing themselves. Lumber prices have started coming down for instance: https://www.nasdaq.com/market-activity/commodities/lbs

    It’s true that the markets now fear inflation, and unlike during the Great Recession this time central bank intervention sharply increased M2 money supply rather than simply bank reserves. Additionally, the additional bonus paid on unemployment insurance is squeezing unskilled and semi-skilled labor supply. But it must be remembered that the economy remains far below pre-COVID capacity (eight million jobs short for instance), energy prices are moderate, and disinflationary structural megatrends such as low birth rates and “free trade” haven’t gone away.

    That said, if you fear inflation, you should be tailoring your portfolio accordingly. Get out of cash and (most) bonds, and invest in equities where the underlying businesses have real pricing power. Dividends from American corporations have outpaced inflation in every decade on record other than the 1970s, and in the 1970s selecting appropriate companies rather than the broad market would have worked. A Dividend Aristocrats ETF for instance would do nicely.

    It’s true that equity markets are expensive, indeed substantially overvalued, at present. High valuations imply poor future returns, though as always the timing is uncertain. What happened was that the market expected there to be a V-shaped recovery, which turned out to be broadly correct. This rapidly incorporated the expectation of future earnings into present stock prices. Now earnings are indeed rising rapidly to match investor expectations, with record numbers of companies beating earnings estimates: https://www.foxbusiness.com/markets/record-share-of-companies-are-beating-earnings-estimates

    With earnings rising strongly and the economy continuing to reopen, it’s unlikely that stocks will crash (note: unlikely does not mean impossible), but given high stock prices at the moment it’s a near mathematical certainty that overall stock returns will be poor this decade. How these poor returns will look no one will know. Owing to the dot com / telecom bubble and the Global Financial Crisis, many people these days are primed for a crash. But it doesn’t have to be a crash–stocks could just go sideways for a long time. Investors who want to post strong returns will need to do some serious scuttlebutt to find alternatives. In Anatoly Karlin’s comments we’ve been discussing Russian stocks (very cheap, though some cheap for a reason), and of course there’s the ongoing cryptomania.

    Interest rates may indeed raise, but the idea that this will blow up tens of millions of mortgages is silly. Most mortgages are fixed rate mortgages, and the Bush-era days of issuing low down payment mortgages and/or adjustable rate mortgages to people without requiring private mortgage insurance are long gone.

    Lastly, a note about money creation. Most money is created by the private sector, not the FED. How it works is that the banks first issue new money by originating loans, then they go looking for reserves. Typically this does not mean using the discount window to borrow overnight from the FED, because the FED’s requirements are tough: https://www.bankrate.com/banking/federal-reserve/discount-window-banks-borrow-from-fed/

    Banks will instead try to attract customer deposits, borrow from other banks in the interbank lending market, or issue securities (typically bonds, but if things get bad they’ll do a capital raise). The FED instead exists to backstop the entire system when no one will lend…at least other than Berkshire Hathaway in exchange for a pound of flesh (and Warren Buffet gives you one hour to accept his terms).

    • Agree: V. K. Ovelund
    • Replies: @Thomasina
    @Thorfinnsson

    "Banks will instead try to attract customer deposits, borrow from other banks in the interbank lending market, or issue securities (typically bonds, but if things get bad they’ll do a capital raise)."

    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!

    "The FED instead exists to backstop the entire system when no one will lend…"

    Someone will always lend - for the right price. The problem is that they don't want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.

    Replies: @Thorfinnsson

  45. anon[299] • Disclaimer says:
    @Bartolo
    @AudaciousEpigone : Can you recommend a book that explains well and in detail the evils of Central Banks, please?

    Replies: @Audacious Epigone, @WorkingClass, @ThreeCranes, @anon

    A few books that are off the beaten track may be useful to you. First of all, I suggest Fiat Money in France by Andrew White. It used to be a kind of hard to find book, but now there are many copies online in PDF. It was written by a 19th century man, so the style may be odd to you, but as a discourse on the Assignat paper of Revolutionary France (1789 onward) and the effects it created the book is excellent. Inflation? Hard assets? Economic warpage? It’s all there, and White makes no secret what side he’s on.

    Then I would suggest entertaining yourself with selections from Extraordinary Popular Delusions and the Madness of Crowds by MacKay. A 19th century work that documents among other things the Mississippi Bubble of France and the South Seas Bubble of England as well as the Dutch Tulip Mania, it does capture quite a bit of the flavor that manias induce. I re-read it during the housing bubble of 15 years ago, by the way. MacKay was a lawyer, so he just chronicled things he found interesting.

    For a view from the other side I would suggest Manias, Panics and Crashes by Thomas Kindleberger. I think there are PDF’s as well, but you may prefer a hard copy. His bias should be obvious from his biography, and some find his book a bit slow going like a textbook, but he does extensively document in a narrative form a series of unfortunate economic events from the 17th century on. The US Panic of 1873 had its roots in the failure of Austrian banks much like US Savings & Loans, for example. Many of the canals built in the US in the 19th century were funded by bonds that ultimately reverted to a value of zero.

    Kindlberger’s thesis boils down to what he views as a fact: in any economy, there must always be a lender of last resort, a lender that can buy and retire (“clear”) debt instruments in all extreme circumstances. But the market participants universally must be perpetually in doubt as to whether that lender will actually come through or not; this should constrain their worst tendencies.

    One detail that Kindleberger doesn’t really discuss much, probably due to his pro-central-bank prejudice, is important: the US got along ok for most of the 19th century and the first decade of the 20th century with no central bank at all. Jackson’s demolition of the Bank did not lead to doom as expected. In fact, one could read Kindleberger and note that the absence of a visible lender-of-last-resort may have constrained market players more than he wished to admit.

    Tangent…
    In my opinion, both the roaring 20’s and the 30’s Depression resulted from the US Federal Reserve Bank trying out its powers on the post WW I recession. Few know it, but the peace of 1918-1919 brought big economic dislocation to even the safe US, with millions thrown out of their war industry jobs. The trains were covered with men riding the rails to find work. Fooling around with the money supply led to a huge expansion in the 1920’s, and as always that party was followed by the hangover in the 1930’s. Washing away that debt and dealing with poor economic choices took up years; years longer than it should have, because the newly powerful DC players had to try to micromanage.

    • Thanks: V. K. Ovelund, Mark G.
    • Replies: @Thomasina
    @anon

    Sounds like Kindleberger's book should have been titled "Manufactured Manias and their Inevitable Downfall" or "The First Pigs to Feed at the Trough get the Fattest".

    "...in any economy, there must always be a lender of last resort, a lender that can buy and retire ('clear') debt instruments in all extreme circumstances. But the market participants universally must be perpetually in doubt as to whether that lender will actually come through or not; this should constrain their worst tendencies."

    What a load of crap! I agree with you: "In fact, one could read Kindleberger and note that the absence of a visible lender-of-last-resort may have constrained market players more than he wished to admit."

    Of course it constrained them. There should be no lender of last resort. When people start having too much fun, then interest rates should go up until the risk-taking stops and the "stupid" are removed from the game. Who currently have their foot on the neck of interest rates? The lender of last resort.

    Replies: @V. K. Ovelund

  46. @anon
    @Bartolo

    A few books that are off the beaten track may be useful to you. First of all, I suggest Fiat Money in France by Andrew White. It used to be a kind of hard to find book, but now there are many copies online in PDF. It was written by a 19th century man, so the style may be odd to you, but as a discourse on the Assignat paper of Revolutionary France (1789 onward) and the effects it created the book is excellent. Inflation? Hard assets? Economic warpage? It's all there, and White makes no secret what side he's on.

    Then I would suggest entertaining yourself with selections from Extraordinary Popular Delusions and the Madness of Crowds by MacKay. A 19th century work that documents among other things the Mississippi Bubble of France and the South Seas Bubble of England as well as the Dutch Tulip Mania, it does capture quite a bit of the flavor that manias induce. I re-read it during the housing bubble of 15 years ago, by the way. MacKay was a lawyer, so he just chronicled things he found interesting.

    For a view from the other side I would suggest Manias, Panics and Crashes by Thomas Kindleberger. I think there are PDF's as well, but you may prefer a hard copy. His bias should be obvious from his biography, and some find his book a bit slow going like a textbook, but he does extensively document in a narrative form a series of unfortunate economic events from the 17th century on. The US Panic of 1873 had its roots in the failure of Austrian banks much like US Savings & Loans, for example. Many of the canals built in the US in the 19th century were funded by bonds that ultimately reverted to a value of zero.

    Kindlberger's thesis boils down to what he views as a fact: in any economy, there must always be a lender of last resort, a lender that can buy and retire ("clear") debt instruments in all extreme circumstances. But the market participants universally must be perpetually in doubt as to whether that lender will actually come through or not; this should constrain their worst tendencies.

    One detail that Kindleberger doesn't really discuss much, probably due to his pro-central-bank prejudice, is important: the US got along ok for most of the 19th century and the first decade of the 20th century with no central bank at all. Jackson's demolition of the Bank did not lead to doom as expected. In fact, one could read Kindleberger and note that the absence of a visible lender-of-last-resort may have constrained market players more than he wished to admit.

    Tangent...
    In my opinion, both the roaring 20's and the 30's Depression resulted from the US Federal Reserve Bank trying out its powers on the post WW I recession. Few know it, but the peace of 1918-1919 brought big economic dislocation to even the safe US, with millions thrown out of their war industry jobs. The trains were covered with men riding the rails to find work. Fooling around with the money supply led to a huge expansion in the 1920's, and as always that party was followed by the hangover in the 1930's. Washing away that debt and dealing with poor economic choices took up years; years longer than it should have, because the newly powerful DC players had to try to micromanage.

    Replies: @Thomasina

    Sounds like Kindleberger’s book should have been titled “Manufactured Manias and their Inevitable Downfall” or “The First Pigs to Feed at the Trough get the Fattest”.

    “…in any economy, there must always be a lender of last resort, a lender that can buy and retire (‘clear’) debt instruments in all extreme circumstances. But the market participants universally must be perpetually in doubt as to whether that lender will actually come through or not; this should constrain their worst tendencies.”

    What a load of crap! I agree with you: “In fact, one could read Kindleberger and note that the absence of a visible lender-of-last-resort may have constrained market players more than he wished to admit.”

    Of course it constrained them. There should be no lender of last resort. When people start having too much fun, then interest rates should go up until the risk-taking stops and the “stupid” are removed from the game. Who currently have their foot on the neck of interest rates? The lender of last resort.

    • Agree: Audacious Epigone
    • Replies: @V. K. Ovelund
    @Thomasina


    There should be no lender of last resort.
     
    I don't know about that. Monetary shocks could be pretty severe. Unemployment at 20 percent was no joke.

    Modern central banking has buffered the shocks. It has buffered them so long, we have forgotten how those shocks felt. I am not eager to bring the old shocks back.

    Replies: @Thomasina

  47. @Thomasina
    @anon

    Sounds like Kindleberger's book should have been titled "Manufactured Manias and their Inevitable Downfall" or "The First Pigs to Feed at the Trough get the Fattest".

    "...in any economy, there must always be a lender of last resort, a lender that can buy and retire ('clear') debt instruments in all extreme circumstances. But the market participants universally must be perpetually in doubt as to whether that lender will actually come through or not; this should constrain their worst tendencies."

    What a load of crap! I agree with you: "In fact, one could read Kindleberger and note that the absence of a visible lender-of-last-resort may have constrained market players more than he wished to admit."

    Of course it constrained them. There should be no lender of last resort. When people start having too much fun, then interest rates should go up until the risk-taking stops and the "stupid" are removed from the game. Who currently have their foot on the neck of interest rates? The lender of last resort.

    Replies: @V. K. Ovelund

    There should be no lender of last resort.

    I don’t know about that. Monetary shocks could be pretty severe. Unemployment at 20 percent was no joke.

    Modern central banking has buffered the shocks. It has buffered them so long, we have forgotten how those shocks felt. I am not eager to bring the old shocks back.

    • Replies: @Thomasina
    @V. K. Ovelund

    "Modern central banking has buffered the shocks. It has buffered them so long, we have forgotten how those shocks felt."

    Yes, they've been buffering since Greenspan came in in the 1980's. Modern central banking? When did the memo come out? You mean they just changed the way they do things to cover up the bubbles and asset inflation they have carefully manufactured and massaged? Central bankers are there to bail out the banks and big corporations. Politicians are there to allow it.

  48. The Fed is the beating heart of the welfare-warfare state… Welfare my ass, Clinton created workfare for everyone except pregnant women and mothers, to begrudge this group is to invite more crime and violence in our future.

    Warefare… TRUE… US warfare is funded by Treasury Notes and the cost has been exactly equal to the national debt during most of our lifetimes.

    But it is convenient for the financial classes that it is… True the Federal Reserve is a Corporation with about 22 stockholders who have access to that unlimited cash window.

    The Treasure Fed creates whatever it needs to fund whatever it wants to. TRUE… As Ron Paul & Bernie Sanders exposed during an audit the Fed secretly provided $17 trillion to prop up those criminal stockholders. CitiCorp was the largest beneficiary initially… but that led to a program of Quanititive Easing (QE) which quickly reached $29 trillion and has not stopped… By comparison the alleged Congressional “bailout” was about $600 billion and was quickly paid back in order to make all the CEO’s eligible for bonuses.

    The big banks get their hands on the new money first, for free, when its value is highest. MOSTLY TRUE… By permitting private lenders to fund public works projects the costs double and triple… China doesn’t do this and can write off failed ventures without serious consequence giving them a huge competitive advantage.

    Prices are about to spin out of control. Probably TRUE… But, commodity shortages trigger out of control inflation, not government debt. This effect has been most dramatic with wood products, whose warehouses are empty.

    The equity markets would plunge and with them boomer pensions and 401(k)s… TRUE, this is part of a centuries long running boom-bust cycle which transfers massive profits to 1% at the expense of the 99%. It is a fact that 90% of the rigged stock market investors lose money and 10% win. Even holding an overpriced mortgage will be dangerous. Not to worry Black Rock will buy them all up for 5 cents on the dollar.

    This will revivify the Tea Party (initially led by Dick Army and Koch Bros) and Occupy Wall Street, which was a true grass roots movement, which was attacked by the police coast to coast, under Obama.

    The beginning of a painful process that will see the dollar dethroned and the American monetary standard of living decline… TRUE… This process began in 1948 with Taft-Hartley which most importantly made it illegal for unions to strike together. But, because only US manufacturing emerged from WWII virtually unscathed it accumulated great wealth after the war, including vast gold reserves. By 1970 a war on wages began which eventually led to the off-shoring of jobs in a deliberate policy to shift the US economy from manufacturing to service.

    It’s worth knowing who is to blame… CAN’T ARGUE WITH THAT STATEMENT. BUT PUBLIC OPINION HAS NOT DRIVEN POLICY SINCE FDR.

  49. @Thorfinnsson
    Reposting my comment from AE's last outbreak of hard money doomerism: https://www.unz.com/anepigone/everything-is-going-up-because-the-dollar-is-going-down/#comment-4657168


    Reality check–the April surge in inflation was driven by a few categories which normally accounted for 13% of consumer spending and were impacted by reopening quirks: https://www.barrons.com/articles/dont-be-fooled-by-aprils-inflation-jump-its-being-driven-by-reopening-quirks-51620847392

    The April inflation surge may well be a temporary phenomenon driven by the very poor response to the pandemic and the global shortage of semiconductors. Some of the weird supply bottlenecks are fixing themselves. Lumber prices have started coming down for instance: https://www.nasdaq.com/market-activity/commodities/lbs

    It’s true that the markets now fear inflation, and unlike during the Great Recession this time central bank intervention sharply increased M2 money supply rather than simply bank reserves. Additionally, the additional bonus paid on unemployment insurance is squeezing unskilled and semi-skilled labor supply. But it must be remembered that the economy remains far below pre-COVID capacity (eight million jobs short for instance), energy prices are moderate, and disinflationary structural megatrends such as low birth rates and “free trade” haven’t gone away.

    That said, if you fear inflation, you should be tailoring your portfolio accordingly. Get out of cash and (most) bonds, and invest in equities where the underlying businesses have real pricing power. Dividends from American corporations have outpaced inflation in every decade on record other than the 1970s, and in the 1970s selecting appropriate companies rather than the broad market would have worked. A Dividend Aristocrats ETF for instance would do nicely.
     
    It's true that equity markets are expensive, indeed substantially overvalued, at present. High valuations imply poor future returns, though as always the timing is uncertain. What happened was that the market expected there to be a V-shaped recovery, which turned out to be broadly correct. This rapidly incorporated the expectation of future earnings into present stock prices. Now earnings are indeed rising rapidly to match investor expectations, with record numbers of companies beating earnings estimates: https://www.foxbusiness.com/markets/record-share-of-companies-are-beating-earnings-estimates

    With earnings rising strongly and the economy continuing to reopen, it's unlikely that stocks will crash (note: unlikely does not mean impossible), but given high stock prices at the moment it's a near mathematical certainty that overall stock returns will be poor this decade. How these poor returns will look no one will know. Owing to the dot com / telecom bubble and the Global Financial Crisis, many people these days are primed for a crash. But it doesn't have to be a crash--stocks could just go sideways for a long time. Investors who want to post strong returns will need to do some serious scuttlebutt to find alternatives. In Anatoly Karlin's comments we've been discussing Russian stocks (very cheap, though some cheap for a reason), and of course there's the ongoing cryptomania.

    Interest rates may indeed raise, but the idea that this will blow up tens of millions of mortgages is silly. Most mortgages are fixed rate mortgages, and the Bush-era days of issuing low down payment mortgages and/or adjustable rate mortgages to people without requiring private mortgage insurance are long gone.

    Lastly, a note about money creation. Most money is created by the private sector, not the FED. How it works is that the banks first issue new money by originating loans, then they go looking for reserves. Typically this does not mean using the discount window to borrow overnight from the FED, because the FED's requirements are tough: https://www.bankrate.com/banking/federal-reserve/discount-window-banks-borrow-from-fed/

    Banks will instead try to attract customer deposits, borrow from other banks in the interbank lending market, or issue securities (typically bonds, but if things get bad they'll do a capital raise). The FED instead exists to backstop the entire system when no one will lend...at least other than Berkshire Hathaway in exchange for a pound of flesh (and Warren Buffet gives you one hour to accept his terms).

    Replies: @Thomasina

    “Banks will instead try to attract customer deposits, borrow from other banks in the interbank lending market, or issue securities (typically bonds, but if things get bad they’ll do a capital raise).”

    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!

    “The FED instead exists to backstop the entire system when no one will lend…”

    Someone will always lend – for the right price. The problem is that they don’t want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.

    • Replies: @Thorfinnsson
    @Thomasina



    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!
     
    Indeed, this is what central banks are for, and this is reflected in the sharp increase in M2 money supply which is stoking the current higher inflation expectations. Central bank intervention in the United States and abroad was effective in response to the COVID pandemic and was better handled than in the Global Financial Crisis.

    Someone will always lend – for the right price. The problem is that they don’t want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.
     
    There may well always be someone who will lend at a certain price, but this lending may not be sufficient to backstop financial system and the underlying real economy. Additionally, it must be noted that in financial panics sometimes situations arise where very few if any people will provide liquidity even against top quality collateral. A good example was when Lehman couldn't get anyone to take its Treasuries back in 2008. Furthermore, prior to central banks adopting the lender of last resort role the payment system itself could and did freeze up when clearing banks were unable to function or even failed outright.

    This is only "outrageous" to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency.

    I'm not going to defend everything central banks do of course. Like all other institutions they routinely get things wrong, and there's definitely a moral hazard problem right now where the equities market implicitly expects intervention against ordinary bear markets.

    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).

    Replies: @V. K. Ovelund, @Thomasina, @Audacious Epigone

  50. @Thomasina
    @Thorfinnsson

    "Banks will instead try to attract customer deposits, borrow from other banks in the interbank lending market, or issue securities (typically bonds, but if things get bad they’ll do a capital raise)."

    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!

    "The FED instead exists to backstop the entire system when no one will lend…"

    Someone will always lend - for the right price. The problem is that they don't want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.

    Replies: @Thorfinnsson

    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!

    Indeed, this is what central banks are for, and this is reflected in the sharp increase in M2 money supply which is stoking the current higher inflation expectations. Central bank intervention in the United States and abroad was effective in response to the COVID pandemic and was better handled than in the Global Financial Crisis.

    Someone will always lend – for the right price. The problem is that they don’t want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.

    There may well always be someone who will lend at a certain price, but this lending may not be sufficient to backstop financial system and the underlying real economy. Additionally, it must be noted that in financial panics sometimes situations arise where very few if any people will provide liquidity even against top quality collateral. A good example was when Lehman couldn’t get anyone to take its Treasuries back in 2008. Furthermore, prior to central banks adopting the lender of last resort role the payment system itself could and did freeze up when clearing banks were unable to function or even failed outright.

    This is only “outrageous” to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency.

    I’m not going to defend everything central banks do of course. Like all other institutions they routinely get things wrong, and there’s definitely a moral hazard problem right now where the equities market implicitly expects intervention against ordinary bear markets.

    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).

    • Replies: @V. K. Ovelund
    @Thorfinnsson


    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).
     
    I completely agree. Nevertheless, modern central banking has one serious drawback: it is too complex for the citizenry to understand.

    Of course, many things are too complex for the citizenry to understand, such as (for example) roadbed engineering and the Internet. However, the citizen understands the purpose of the roadbed when he uses the road, and the citizen understands the general operation or behavior of the Internet when he posts at Unz. By contrast, the citizen does not understand the purpose, operation or behavior of a central-bank-managed fiat-money system.

    It is obvious to the citizen that he has gained something worth gaining by roadbeds and the Internet. By contrast, it is far from obvious to the citizen that he has gained anything worth gaining by surrendering his purse of gold coins for fiat. To the citizen, the circumstance feels too much like a game of Monopoly in which no one will tell the player the rules.

    Despite the apparent advantages of fiat, I sometimes wonder if we would not be better off getting back our purses of gold coins, instead. The citizen understands his purse. He does not rely on a Federal Reserve board to decide how much wealth the purse represents. There is value in that.

    Some things are better simple than optimal, for reason of public morale. I agree with you: fiat and central banking are probably preferable in net; yet the damage they do to public trust is real.

    Replies: @Thorfinnsson

    , @Thomasina
    @Thorfinnsson

    "This is only “outrageous” to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency."

    Come on, the Federal Reserve is mandated "to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates."

    They should NEVER have been given the goal of "maximum employment". Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those "stable prices"? Where are they?

    And how about "moderate long term interest rates"? Where are they?

    The Federal Reserve are there to bail out their owners, the banks.

    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.

    Replies: @V. K. Ovelund, @Thorfinnsson, @Audacious Epigone

    , @Audacious Epigone
    @Thorfinnsson

    What current higher inflation expectations? The estimates for April were all lower than the official number. I guess the expectations are higher now, but they weren't as recently as a month ago, were they?

  51. @Thorfinnsson
    @Thomasina



    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!
     
    Indeed, this is what central banks are for, and this is reflected in the sharp increase in M2 money supply which is stoking the current higher inflation expectations. Central bank intervention in the United States and abroad was effective in response to the COVID pandemic and was better handled than in the Global Financial Crisis.

    Someone will always lend – for the right price. The problem is that they don’t want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.
     
    There may well always be someone who will lend at a certain price, but this lending may not be sufficient to backstop financial system and the underlying real economy. Additionally, it must be noted that in financial panics sometimes situations arise where very few if any people will provide liquidity even against top quality collateral. A good example was when Lehman couldn't get anyone to take its Treasuries back in 2008. Furthermore, prior to central banks adopting the lender of last resort role the payment system itself could and did freeze up when clearing banks were unable to function or even failed outright.

    This is only "outrageous" to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency.

    I'm not going to defend everything central banks do of course. Like all other institutions they routinely get things wrong, and there's definitely a moral hazard problem right now where the equities market implicitly expects intervention against ordinary bear markets.

    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).

    Replies: @V. K. Ovelund, @Thomasina, @Audacious Epigone

    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).

    I completely agree. Nevertheless, modern central banking has one serious drawback: it is too complex for the citizenry to understand.

    Of course, many things are too complex for the citizenry to understand, such as (for example) roadbed engineering and the Internet. However, the citizen understands the purpose of the roadbed when he uses the road, and the citizen understands the general operation or behavior of the Internet when he posts at Unz. By contrast, the citizen does not understand the purpose, operation or behavior of a central-bank-managed fiat-money system.

    It is obvious to the citizen that he has gained something worth gaining by roadbeds and the Internet. By contrast, it is far from obvious to the citizen that he has gained anything worth gaining by surrendering his purse of gold coins for fiat. To the citizen, the circumstance feels too much like a game of Monopoly in which no one will tell the player the rules.

    Despite the apparent advantages of fiat, I sometimes wonder if we would not be better off getting back our purses of gold coins, instead. The citizen understands his purse. He does not rely on a Federal Reserve board to decide how much wealth the purse represents. There is value in that.

    Some things are better simple than optimal, for reason of public morale. I agree with you: fiat and central banking are probably preferable in net; yet the damage they do to public trust is real.

    • Replies: @Thorfinnsson
    @V. K. Ovelund

    The maintenance of the gold standard requires more or less the same thing as the maintenance of credible fiat money: political discipline. But a fiat standard makes it easier for the government to run deficits, which is very valuable during recessions.

    It's true that gold is both intrinsically valuable and understandable, but the classical gold standard was not always popular with the public. In the United States the Populists of the Gilded Age bitterly denounced the suspension of free coinage of silver as The Crime of '73, and many also supported the issuance of unbacked paper currency by the federal government (not banks). This birthed the powerful Free Silver political movement, culminating in William Jennings Bryan's legendary Cross of Gold nomination speech at the 1896 Democratic Convention:

    Having behind us the producing masses of this nation and the world, supported by the commercial interests, the laboring interests, and the toilers everywhere, we will answer their demand for a gold standard by saying to them: "You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold."
     

    -William Jennings Bryan

    In a market economy there will always be grousing about money (and much else). People are inherently uncomfortable with swift changes in prices, wages, and asset values.

  52. @V. K. Ovelund
    @Thomasina


    There should be no lender of last resort.
     
    I don't know about that. Monetary shocks could be pretty severe. Unemployment at 20 percent was no joke.

    Modern central banking has buffered the shocks. It has buffered them so long, we have forgotten how those shocks felt. I am not eager to bring the old shocks back.

    Replies: @Thomasina

    “Modern central banking has buffered the shocks. It has buffered them so long, we have forgotten how those shocks felt.”

    Yes, they’ve been buffering since Greenspan came in in the 1980’s. Modern central banking? When did the memo come out? You mean they just changed the way they do things to cover up the bubbles and asset inflation they have carefully manufactured and massaged? Central bankers are there to bail out the banks and big corporations. Politicians are there to allow it.

  53. @Thorfinnsson
    @Thomasina



    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!
     
    Indeed, this is what central banks are for, and this is reflected in the sharp increase in M2 money supply which is stoking the current higher inflation expectations. Central bank intervention in the United States and abroad was effective in response to the COVID pandemic and was better handled than in the Global Financial Crisis.

    Someone will always lend – for the right price. The problem is that they don’t want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.
     
    There may well always be someone who will lend at a certain price, but this lending may not be sufficient to backstop financial system and the underlying real economy. Additionally, it must be noted that in financial panics sometimes situations arise where very few if any people will provide liquidity even against top quality collateral. A good example was when Lehman couldn't get anyone to take its Treasuries back in 2008. Furthermore, prior to central banks adopting the lender of last resort role the payment system itself could and did freeze up when clearing banks were unable to function or even failed outright.

    This is only "outrageous" to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency.

    I'm not going to defend everything central banks do of course. Like all other institutions they routinely get things wrong, and there's definitely a moral hazard problem right now where the equities market implicitly expects intervention against ordinary bear markets.

    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).

    Replies: @V. K. Ovelund, @Thomasina, @Audacious Epigone

    “This is only “outrageous” to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency.”

    Come on, the Federal Reserve is mandated “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

    They should NEVER have been given the goal of “maximum employment”. Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those “stable prices”? Where are they?

    And how about “moderate long term interest rates”? Where are they?

    The Federal Reserve are there to bail out their owners, the banks.

    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.

    • Replies: @V. K. Ovelund
    @Thomasina


    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.
     
    He does? How does it benefit him?

    @Thorfinnsson happens to have studied the topic of central banking a bit. What is wrong with that?

    I might have used a different term than @Thorfinnsson's “religious fanatics” to refer to inexpert fiat skeptics, but his take on central banking looks pretty sound to me. Did he say something incorrect?

    Replies: @Thomasina

    , @Thorfinnsson
    @Thomasina



    Come on, the Federal Reserve is mandated “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

    They should NEVER have been given the goal of “maximum employment”. Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those “stable prices”? Where are they?

     

    These sound like pretty reasonable goals to me.

    The full employment mandate, a good goal though on occasion in contradiction to the stable price mandate, dates to 1946 when immigration was at a low ebb. It would remain low for several decades.

    We do need many structural changes concerning immigration of course, but this is mostly outside the scope of the discussion. At it relates to central bank policy the law ought to be amended to state that the central bank has a mission to promote the full employment of natural born citizens.

    As for stable prices, critics of fiat money and central banking like to point out that since the suspension of convertibility to gold that the currency has progressively lost purchasing power. True, but irrelevant unless your savings are kept under your mattress. The volatility of prices has dropped dramatically. In the free banking era year-on-year prices changes, in either direction, of as much as one-third were not uncommon.

    See these charts:

    http://si.wsj.net/public/resources/images/BN-LR771_inflat_G_20151214123936.png

    http://2.bp.blogspot.com/-TNO2VXXOh2A/Tvn9jZRZIpI/AAAAAAAAAug/BJbRQBCULcs/s1600/Inflation-1800-1912.jpg

    http://1.bp.blogspot.com/_TAM6pE-50TM/S_WKd2Ry_zI/AAAAAAAAAeg/GL9AhCdG4R0/s1600/100520-2.jpg

    http://2.bp.blogspot.com/-ZCxGaqGJDWM/Tvn96zOLm9I/AAAAAAAAAu0/hiHvBKZG0lE/s1600/Inflation-1900-2011.jpg

    Substantial moderation is quite clear.


    And how about “moderate long term interest rates”? Where are they?
     
    This was not my claim, and it's also important to realize that central banks have far less control over long term interests rates than most people realize. Here it is charted:

    https://allstarcharts.com/wp-content/uploads/2012/06/6-3-12-Long-term-rates-back-to-1790.gif


    The Federal Reserve are there to bail out their owners, the banks.
     
    Well, yes. It's a lender of last resort which is fully authorized to backstop the entire banking system.
    , @Audacious Epigone
    @Thomasina

    The Fed now has a triple mandate--don't forget about the command to reduce income inequality.

    Replies: @dfordoom

  54. @Thomasina
    @Thorfinnsson

    "This is only “outrageous” to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency."

    Come on, the Federal Reserve is mandated "to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates."

    They should NEVER have been given the goal of "maximum employment". Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those "stable prices"? Where are they?

    And how about "moderate long term interest rates"? Where are they?

    The Federal Reserve are there to bail out their owners, the banks.

    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.

    Replies: @V. K. Ovelund, @Thorfinnsson, @Audacious Epigone

    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.

    He does? How does it benefit him?

    happens to have studied the topic of central banking a bit. What is wrong with that?

    I might have used a different term than ’s “religious fanatics” to refer to inexpert fiat skeptics, but his take on central banking looks pretty sound to me. Did he say something incorrect?

    • Replies: @Thomasina
    @V. K. Ovelund

    @Thorfinnsson happens to have studied the topic of central banking a bit."

    Has he? He's studied it "a bit"? How do you know that?

    "Inexpert fiat skeptics"? You'd probably characterize the people who brought us the bubbles as "experts". Absolutely laughable. They're owned.

    "His take on central banking looks pretty sound to me." How would you know?

    Replies: @V. K. Ovelund

  55. @V. K. Ovelund
    @Thomasina


    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.
     
    He does? How does it benefit him?

    @Thorfinnsson happens to have studied the topic of central banking a bit. What is wrong with that?

    I might have used a different term than @Thorfinnsson's “religious fanatics” to refer to inexpert fiat skeptics, but his take on central banking looks pretty sound to me. Did he say something incorrect?

    Replies: @Thomasina

    happens to have studied the topic of central banking a bit.”

    Has he? He’s studied it “a bit”? How do you know that?

    “Inexpert fiat skeptics”? You’d probably characterize the people who brought us the bubbles as “experts”. Absolutely laughable. They’re owned.

    “His take on central banking looks pretty sound to me.” How would you know?

    • Replies: @V. K. Ovelund
    @Thomasina


    How do you know that?
     
    I don't.

    How would you know?
     
    I wouldn't.

    Meanwhile, I should have avoided the bait you laid. My mistake.
  56. @Thomasina
    @V. K. Ovelund

    @Thorfinnsson happens to have studied the topic of central banking a bit."

    Has he? He's studied it "a bit"? How do you know that?

    "Inexpert fiat skeptics"? You'd probably characterize the people who brought us the bubbles as "experts". Absolutely laughable. They're owned.

    "His take on central banking looks pretty sound to me." How would you know?

    Replies: @V. K. Ovelund

    How do you know that?

    I don’t.

    How would you know?

    I wouldn’t.

    Meanwhile, I should have avoided the bait you laid. My mistake.

  57. @V. K. Ovelund
    @Thorfinnsson


    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).
     
    I completely agree. Nevertheless, modern central banking has one serious drawback: it is too complex for the citizenry to understand.

    Of course, many things are too complex for the citizenry to understand, such as (for example) roadbed engineering and the Internet. However, the citizen understands the purpose of the roadbed when he uses the road, and the citizen understands the general operation or behavior of the Internet when he posts at Unz. By contrast, the citizen does not understand the purpose, operation or behavior of a central-bank-managed fiat-money system.

    It is obvious to the citizen that he has gained something worth gaining by roadbeds and the Internet. By contrast, it is far from obvious to the citizen that he has gained anything worth gaining by surrendering his purse of gold coins for fiat. To the citizen, the circumstance feels too much like a game of Monopoly in which no one will tell the player the rules.

    Despite the apparent advantages of fiat, I sometimes wonder if we would not be better off getting back our purses of gold coins, instead. The citizen understands his purse. He does not rely on a Federal Reserve board to decide how much wealth the purse represents. There is value in that.

    Some things are better simple than optimal, for reason of public morale. I agree with you: fiat and central banking are probably preferable in net; yet the damage they do to public trust is real.

    Replies: @Thorfinnsson

    The maintenance of the gold standard requires more or less the same thing as the maintenance of credible fiat money: political discipline. But a fiat standard makes it easier for the government to run deficits, which is very valuable during recessions.

    It’s true that gold is both intrinsically valuable and understandable, but the classical gold standard was not always popular with the public. In the United States the Populists of the Gilded Age bitterly denounced the suspension of free coinage of silver as The Crime of ’73, and many also supported the issuance of unbacked paper currency by the federal government (not banks). This birthed the powerful Free Silver political movement, culminating in William Jennings Bryan’s legendary Cross of Gold nomination speech at the 1896 Democratic Convention:

    Having behind us the producing masses of this nation and the world, supported by the commercial interests, the laboring interests, and the toilers everywhere, we will answer their demand for a gold standard by saying to them: “You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold.”

    -William Jennings Bryan

    In a market economy there will always be grousing about money (and much else). People are inherently uncomfortable with swift changes in prices, wages, and asset values.

    • Thanks: V. K. Ovelund
  58. @Thomasina
    @Thorfinnsson

    "This is only “outrageous” to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency."

    Come on, the Federal Reserve is mandated "to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates."

    They should NEVER have been given the goal of "maximum employment". Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those "stable prices"? Where are they?

    And how about "moderate long term interest rates"? Where are they?

    The Federal Reserve are there to bail out their owners, the banks.

    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.

    Replies: @V. K. Ovelund, @Thorfinnsson, @Audacious Epigone

    Come on, the Federal Reserve is mandated “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”

    They should NEVER have been given the goal of “maximum employment”. Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those “stable prices”? Where are they?

    These sound like pretty reasonable goals to me.

    The full employment mandate, a good goal though on occasion in contradiction to the stable price mandate, dates to 1946 when immigration was at a low ebb. It would remain low for several decades.

    We do need many structural changes concerning immigration of course, but this is mostly outside the scope of the discussion. At it relates to central bank policy the law ought to be amended to state that the central bank has a mission to promote the full employment of natural born citizens.

    As for stable prices, critics of fiat money and central banking like to point out that since the suspension of convertibility to gold that the currency has progressively lost purchasing power. True, but irrelevant unless your savings are kept under your mattress. The volatility of prices has dropped dramatically. In the free banking era year-on-year prices changes, in either direction, of as much as one-third were not uncommon.

    See these charts:

    Substantial moderation is quite clear.

    And how about “moderate long term interest rates”? Where are they?

    This was not my claim, and it’s also important to realize that central banks have far less control over long term interests rates than most people realize. Here it is charted:

    The Federal Reserve are there to bail out their owners, the banks.

    Well, yes. It’s a lender of last resort which is fully authorized to backstop the entire banking system.

  59. The monetarist playbook calls for raising interest rates in response, but the American economy is saddled with waaaay too much debt for that to be politically viable. Tens of millions of mortgages would go into default.

    Would that happen? I thought most people locked in fixed rate loans when rates were low. When you can borrow money at 3% is it really worth gambling on a variable late loans to save a small amount of money?

    It would certainly hurt the housing market as mortgages get more expensive, and the crash in housing prices would cause grumbling. But I don’t see many folks losing their homes.

    • Replies: @Audacious Epigone
    @JosephB

    A lot of people will be under water if real estate crashes. Many will walk away. Why wouldn't they?

  60. @BigDickBandit
    so like....remind us again how you aren't A Crypto Guy?

    everything you just said is basically the core thesis driving Crypto Folks--most especially Bitcoiners, but Etherium and 'DeFi' folks who envision an entirely peer-to-peer economic system without banks, as well.

    Replies: @Triteleia Laxa, @Catdog, @Alexander Turok, @Audacious Epigone

    I love the idea and I want crypto to take the world by storm.

  61. @Triteleia Laxa
    @BigDickBandit

    How will that economic system be protected from your own government?

    Replies: @dfordoom

    How will that economic system be protected from your own government?

    Agreed.

    An economic system that seeks to bypass the banks will be crushed by the government in order to protect the banks.

    Anything that is a threat to the banks will be crushed. Including crypto.

    Crypto seems more and more likely to turn out to be a libertarian fantasy.

  62. @Thorfinnsson
    @Thomasina



    In September of 2019, the FED stepped in and started bailing when things started to go sideways re interbank lending, and they continued right up until Covid hit. Gee, what a coincidence!
     
    Indeed, this is what central banks are for, and this is reflected in the sharp increase in M2 money supply which is stoking the current higher inflation expectations. Central bank intervention in the United States and abroad was effective in response to the COVID pandemic and was better handled than in the Global Financial Crisis.

    Someone will always lend – for the right price. The problem is that they don’t want to pay that price. This is elementary, yet people rationalize outrageous behavior.

    The FED has absolutely no business existing.
     
    There may well always be someone who will lend at a certain price, but this lending may not be sufficient to backstop financial system and the underlying real economy. Additionally, it must be noted that in financial panics sometimes situations arise where very few if any people will provide liquidity even against top quality collateral. A good example was when Lehman couldn't get anyone to take its Treasuries back in 2008. Furthermore, prior to central banks adopting the lender of last resort role the payment system itself could and did freeze up when clearing banks were unable to function or even failed outright.

    This is only "outrageous" to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency.

    I'm not going to defend everything central banks do of course. Like all other institutions they routinely get things wrong, and there's definitely a moral hazard problem right now where the equities market implicitly expects intervention against ordinary bear markets.

    But in the final analysis the stability of the financial system has been improved by central banks, along with various other stabilization measures such as deposit insurance. Financial panics and bank failures are far less common, and the economic cycle has greatly moderated (though it must be said this is partly for technological reasons).

    Replies: @V. K. Ovelund, @Thomasina, @Audacious Epigone

    What current higher inflation expectations? The estimates for April were all lower than the official number. I guess the expectations are higher now, but they weren’t as recently as a month ago, were they?

  63. @Thomasina
    @Thorfinnsson

    "This is only “outrageous” to religious fanatics who have a fanatical religious hatred of central banks and/or fiat currency."

    Come on, the Federal Reserve is mandated "to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates."

    They should NEVER have been given the goal of "maximum employment". Perhaps they were given this so that it could never be achieved, what with the amount of immigrants flooding into the country?

    And how about those "stable prices"? Where are they?

    And how about "moderate long term interest rates"? Where are they?

    The Federal Reserve are there to bail out their owners, the banks.

    You sound like a religious apologist, rationalizing outrageous behavior because it benefits you.

    Replies: @V. K. Ovelund, @Thorfinnsson, @Audacious Epigone

    The Fed now has a triple mandate–don’t forget about the command to reduce income inequality.

    • Replies: @dfordoom
    @Audacious Epigone


    The Fed now has a triple mandate–don’t forget about the command to reduce income inequality.
     
    Isn't reducing income inequality a good thing?
  64. @JosephB

    The monetarist playbook calls for raising interest rates in response, but the American economy is saddled with waaaay too much debt for that to be politically viable. Tens of millions of mortgages would go into default.
     
    Would that happen? I thought most people locked in fixed rate loans when rates were low. When you can borrow money at 3% is it really worth gambling on a variable late loans to save a small amount of money?

    It would certainly hurt the housing market as mortgages get more expensive, and the crash in housing prices would cause grumbling. But I don't see many folks losing their homes.

    Replies: @Audacious Epigone

    A lot of people will be under water if real estate crashes. Many will walk away. Why wouldn’t they?

  65. @Audacious Epigone
    @Thomasina

    The Fed now has a triple mandate--don't forget about the command to reduce income inequality.

    Replies: @dfordoom

    The Fed now has a triple mandate–don’t forget about the command to reduce income inequality.

    Isn’t reducing income inequality a good thing?

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