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The Money Pump Is Working to Drain Stocks…and There Is No Safety Shutoff!
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There is no safety, as in times past when the Fed was draining money out of the economy and could just flip back to pumping money in, because the Fed is running the outflow pump fast and furious, and the Fed has no option for reversing the pump or even just stopping it this time around.

This time is different — very, very, VERY different, and I’ll tell you why!

Why the Fed MUST keep tightening as stocks crash

During the present stock dump, it’s important to remember that, for the first time in the lives of many investors, there is no Fed safety net under the stock market to arrest its fall, and here is why: The Fed will continue to tighten under inflation, regardless of what stock and bond markets do, because it has to. The Fed has a LEGAL MANDATE to control inflation. It is one of the Fed’s only two mandates — to 1) control inflation while 2) keeping the job market strong and tight.

It will be hard for the Fed to argue the job market is not strong and tight (even though it isn’t) when all the metrics the Fed traditionally uses before congress show employers just cannot find enough laborers for the numerous jobs offered, and official headline unemployment is very low, making the job market really tight and beneficial to the wages of laborers. I have explained elsewhere why this is a false scenario, but it is the scenario the Fed has been presenting to congress for months now. Based on its own chosen metrics, the Fed doesn’t have much room to argue that it needs to tighten the job market more. However, the Fed’s other mandate has run WAY out of control and must legally be dealt with … unless congress were to grant the Fed some special reprieve from its congressional mandate.

The Fed got away with not controlling inflation as is mandatory by telling congress that inflation was “transitory,” which was never remotely true. As my regular readers will recall, I spent the entirety of last year arguing against the Fed on that and against others who thought I was nuts, laying out heaps of evidence over many months as to WHY inflation was not transitory and would become scorching hot, as it has, and why that would kill the stock market. I believed that enough to bet my blog on it, saying I would stop writing on economics if inflation did not rise enough to force the Fed to tighten quickly and kill the stock market or eventually kill the market on its own, even if the Fed didn’t tighten, by raising business costs and deeply undercutting earnings and cutting demand for products by making them too expensive, thus suffocating the whole economy into stagflation.

We’re here. The Fed is tightening due to hot inflation as predicted, and stocks are crashing as bond vigilantes take control. (See “Why Inflation is Not Going to Give the Fed a Break” and “Stocks and Awe: The Federal Reserve Regime Change is Here!“)

We have come to the crux of the trap the Fed has set for itself. The Fed has fully given up the excuse it was using before congress for not dealing with inflation over the past half year. So, they cannot go back to saying that “inflation is transitory,” or congress will scoff in Powell’s face for flip flopping like a dying flounder on hot sand by saying “It’s transitory” then “It’s not transitory, and that term wasn’t helpful” and then “No, it is transitory after all.” He’d lose whatever credibility he has left. So, the Fed now legally has to fight inflation until they battle it down.

The last part of that sentence is what is important — until they battle it down. That means the stock market has no safety net because, even if the Fed battles intensely, it will take months to knock inflation back down to the ground with all the lack-of-labor-therefore-lack-of-production-plus-COVID-border-and-port-closures assuring that supply lines remain plugged as production remains down for months. In other words, the shortages are going to stay around longer than the stock market has left because the market is already falling hard. (And, yes, stocks will almost certainly see some good bear-market rallies along the way down, maybe even after this week’s Fed meeting now that all indices have entered correction. When has it not taken a reprieve in which the diehard bulls tried to recover lost ground? If the Fed comes out of its FOMC meeting this week sounding really dovish because stocks are crashing and the market rallies in a sigh of relief, that rally will only last until the Fed’s next tapering step shoots bond yields back up again.)

How the Fed has trapped itself in an inferno

Yes, it’s true that the Fed LOVES zero interest rates, and the government just LOVES deficit spending and always bails out its big-money friends; but the Fed no longer has the option of keeping rates at zero, and the government may not have the options of deficit spending. That is what is key to understanding why inflation WILL kill this stock market bull.

It is, however, also equally true that the Fed’s LOVE of zero rates for an entire decade and massive money printing have laid in a huge supply of money fuel to burn. It’s not just a tinder box; its is an entire house of cards filled with tinder, soaked in fuel. The Fed has boxed itself into this inflation trap by laying in all the tinder and fuel necessary to keep inflation burning hot for some time, which will force it to attempt to suck the fuel back out very quickly — far quicker, as I recently pointed out in one of the articles referenced above, than we have ever seen before. This is going to be far more unsettling than previous rounds of Fed tightening so will run its course much sooner.

The trap they have lain for themselves was foreseeable for certain. That is why I said since early last year the Fed could be counted on staying with zero rates and massive money printing far too long, creating an inflationary fire tornado. (I’m sure you remember the illustration to the left.) That happens when inflation rises hot enough and long enough to create its own roaring updraft wherein inflation, itself, becomes the cause of further inflation. The Fed’s “transitory” narrative was evidence enough that the Fed was going to do exactly that — wait to long to fight the fire. Throughout the whole “transitory” excuse period — during which the Fed was apparently hoping against all hope that inflation would just give it a lucky break so it didn’t have to kill its dependent markets — the Fed kept adding fuel (of all the crazy things to do) to the incendiary inflation just to keep markets rising on the Fed fuel float. It did so because it knew markets and government finance were dependent on the Fed’s quantitative easing regime for their survival.

Now inflation is a raging inferno the Fed cannot easily put out, so the Fed has switched to a tightening regime, which will have to become quantitative tightening (where the Fed actually sucks money out of the monetary system) in order to wrest inflation under control. Interest-rate increases throttle money supply by reducing the velocity of money, but they don’t necessarily reduce the money supply. At least, not directly. While they curb inflation, we will need to see overabundant money supply dwindle in order to stop high inflation. There is just way too much liquid fuel in the system.

Of course, the stock market is going to lend the Fed a hand there by becoming the new money incinerator to burn that fuel off as money that only existed in computer accounts gets written down rapidly. Think of that as the “flash” tower in a refinery that rapidly burns off fuel when there is trouble in the system. What was mistakenly thought of as wealth is going up in curls of fire and smoke as I write. (I say mistakenly because this phantom wealth was all built on debt, making for easy stock buybacks and easy dividends, not on actual fundamental productivity and profits and capital investment for a more productive future. I am not saying there was no productivity or profits, but I am saying those are NOT what was paying for all those massive stock buybacks over the past decade that pushed up stock prices into bubblicious heights.) Easy come, easy go.

Unlike times past, the new Fed tightening regime will also make it extremely difficult for the government to help out with its usual borrow-and-spend, stimulus-and-bailout programs because government bond rates are now going to soar precisely because the Fed is relinquishing its total control over the treasury market by stepping away to fight inflation. (That is the big reveal — the key — that I laid out for all my readers when I made one of my earlier Patron Posts available for all: “The Big Blindspot that Will Bite Bonds and Stocks in the Butt.” Everything here is going according to the scenario I’ve laid out.) The Fed is busy being a fire fighter, and that will make it hard to help the government out with more cheap credit. We have already seen that Biden failed to get his last borrow-and-spend package through because two moderate Democrats were afraid of how it would fuel inflation by requiring more free money printing from the Fed. The move away from guaranteed low interest for the government makes getting bailouts and stimulus approved harder still. Inflation makes it almost impossible to move BACK TO low interest for the government.

I am sure the Fed and government will find a way to attempt to do something. They have to, but keep in mind how I declared the Fed was dead just ahead of the big crash in 2020 (from “Is the Fed Dead?” in June of 2019 to asking “How Dead is the Fed?” in March to proclaiming it “positively most sincerely dead” in June of 2020. (By all of this I clarified along the way I meant the Fed was dead in terms of its ability to save falling markets.) The Fed proved dead in March of 2020, as I had predicted its next attempt at QE would be, when the market continued to fall even as the Fed pulled out stop after massive stop to try to arrest its fall with guarantee after guarantee of new money, lowered interest rates, etc. — all to no avail.

The market continued falling until the federal government stepped in to put its massive shoulder to the wheel alongside the Fed with gargantuan bailouts all over again. These went mostly to rich corporations (and, hence, bailed out their shareholders), which lacked the resiliency to deal with government-imposed shutdowns because they had spent all of their profits PLUS all of their credit on stock buybacks for the enrichment of those same shareholders.

Almost no one cared about the bailouts because everyone wanted to be rescued … again, just as in the Great Recession. That is what my blog is all about — how we are trapped in an endless rinse and repeat Great-Recession cycle just as I laid out at the very beginning of my blog-writing days and have captured in my ebook, Downtime, which you see continually advertised in the right sidebar my site — not a great read, but funny along the way, and a clear encapsulation of the rinse-and-repeat bailout path the Fed has us all on because it solves every downfall by throwing money at the problem so we don’t have to resolve the true faults that run throughout our economic structures. I have encapsulate those old writings like that to show how predictable this rinse-and-repeat cycle is. AND WE WILL DO IT AGAIN, if we try to rely on the Fed pumping the asset bubbles up with easy money, instead of correcting our deep economic flaws. And that is why that old stuff is worth the read. It’s not great literature, maybe not even good; but it is, at least, amusing; and, as you read it, you’ll see that, yes, here we are predictably where all of those articles said the Fed’s plans would take us and leave us. They are again timely at present.

So, just as in 2008-2009, we saw instant massive bailouts again in 2020 paid for by an enormous increase in government debt. And that partnership with the government as the spender and the Federal Reserve as the press operator for the money printers that went brrrrring along so fast you could not even see the money flying out, is what finally stopped the stock market from falling in the spectacular but short 2020 crash. That, by the way, was the number-three big bust (the first being the dot-com bust, which the Fed solved by pumping up a housing bubble, the second being the housing-bubble bust, which the Fed solved by building up the stock bubble that blew in 200) with government bailouts repeating the cycle each of the last two times (and to some extent back in the dot-com bust). Now we are going into number-four — the even more massive bust of the Everything Bubble that the Fed pumped up after the 2020 collapse — wherein it re-inflated the stock bubble to greater height, fully re-inflated the old housing bubble to the greater price heights ever with the lowest mortgage rates ever, and pumped the bond fuller than ever.

Those 2020 bailouts haven’t taken us very far this time, but they certainly took us very high. They happened by keeping interest rates extremely low when inflation was, at first, hugging zero. Then they ignored inflation and remained essentially at zero, creating a time now that is as altogether different as you could hope to find. It is different than all the previous times because we have not seen the Fed raise rates while already going into a recession, as we are now. Typically, the Fed raises rates in a hot economy until it takes us into recession. It is also different because we have never seen the Fed raise rates to battle inflation after rates have been effectively at zero for years and after years of massive money printing. Last time the Fed battled inflation like this, when it wasn’t already sinking into recession but created a huge recession, it had to fight inflation for more than two years, and rate hit almost twenty percent before it got inflation back down.

Here is another key to understanding why our present situation will be so bad: In 2020, the government was borrowing under the promise that the Fed would keep rates at zero because it could since there was essentially no inflation. This time, the government will be borrowing (if it attempts to do any bailouts) at a time when the Fed is raising rates to battle inflation, and the government’s borrowing will cause bond yields (and interest rates) to rise even faster than they already are. That will make it very tough in congress politically to step up for bailouts, knowing full well that will make inflation hotter and make the struggling masses angrier.

This is a mess — a spectacular mess — that the Fed and Feds have long laid in! So, this is going to get really ugly, really fast. (I’ll soon be writing a Patron Post about how ugly this will get. Those of you who support my writing at the \$5 a month level or above will get the first look at that as my thanks for your solid support, but I’ll probably share it eventually, or part of it, with everyone.)

How the stock-bond pump-and-dump works

Now, you might have noticed bond yields have settled back down. Don’t be fooled by that! I already explained why that would happen months ago. While I explained it again recently, I know I always have critics who think my glass-eye realism (an old banker expression for someone who looks at the numbers with no emotion) is just pessimism, and they look to things like falling bond yields to say, “See, the trouble is already abating. You’ve seen the situation incorrectly.”

No, this is exactly what I said would happen. I’ve called it the seesaw relationship between stocks and bonds, but you can also think of it as an old-fashion pump handle where as the handle is pressed down, the plunger goes up, forcing water to flow. In this case we are pumping from one pool — the stock pool — into another — the bond pool.

It works like this: Bond prices go down as the Fed pushes down on the pump price handle by backing out of the treasury market (which forces yields to rise to attract additional buyers as the Fed ceases to be the buyer of first resort). The rising yields draw money flows from stocks into safer bonds with improving yields (lower prices) until the bond price handle finds a bottom (yields stop rising, prices stop going down). The money flow is being pumped from the stock pool into the bond pool. Then, as investors make bond purchases at those bottom prices, they are slowly lifting the bond-price handle back up with their increased demand for bonds (lowering yields). Then the Fed backs out of more bond-buying again in another step of tapering and pushes the bond-price handle back down for another pump, lifting bond yields on the other side of the fulcrum; thereby, pumping more money from the stock pool into the bond pool.

By that dynamic, bonds don’t just keep rising; however, every time they rise and lower, they are pumping money out of stocks and into bonds … or other safe havens. It is that money flow that temporarily lowers bond yields again until the Fed takes its next step in backing further out of bond purchases, pushing down on the price handle. By the time the Fed is done, the flow of money from stocks is so continuous, it may continue to syphon money from stocks to bonds even when the Fed is done pumping. We call this fear. At that point, the money keeps flowing out under its own pressure.

That is how this particular money pump works, and you might have noticed the price pump is working really well right now!

(Republished from The Great Recession by permission of author or representative)
 
• Category: Economics • Tags: Federal Reserve, Wall Street 
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  1. It’s funny how most of these financial experts always forget
    to mention the \$50,000,000,000.00 per month in INTEREST.
    Someone is getting very rich as this continues.
    Of course they will print more money,wouldn’t you?
    It’s not federal,and debt’s not a reserve.Prai\$e

    • Replies: @cd of central FL
  2. Levtraro says:

    Here is another key to understanding why our present situation will be so bad: In 2020, the government was borrowing under the promise that the Fed would keep rates at zero because it could since there was essentially no inflation. This time, the government will be borrowing (if it attempts to do any bailouts) at a time when the Fed is raising rates to battle inflation, and the government’s borrowing will cause bond yields (and interest rates) to rise even faster than they already are. That will make it very tough in congress politically to step up for bailouts, knowing full well that will make inflation hotter and make the struggling masses angrier.

    Very much correct assessment overall, but two considerations regarding the necessity of bailouts:
    1) the anger of the masses can be managed in the short-term with repression and small hand-outs while the survival of corporate structures can only be secured with large bailouts, and
    2) the government may try to convince or force foreign solvent actors to fund the new bailouts.

  3. This time is different. The world is sending Dollars back to the US because they no longer want them. The Russians, Chinese, and their followers are dumping dollars. Those dollars wind up inside the US where they bid up prices. The Fed can tighten, but they can’t tighten up the tsunami of Dollars entering the US from other nations.

    The Dollar is losing the last of its purchasing power right now. Soon, it will be a failed currency.

    • Replies: @Realist
    , @Levtraro
  4. The Fed will continue to tighten under inflation, regardless of what stock and bond markets do, because it has to. The Fed has a LEGAL MANDATE to control inflation.

    O, you sweet summer child.

    • LOL: Fart Blossom
    • Replies: @Neuday
    , @Rooster12
  5. Realist says:
    @RoatanBill

    The Dollar is losing the last of its purchasing power right now. Soon, it will be a failed currency.

    Not soon enough.

  6. Levtraro says:
    @RoatanBill

    Yes, but the US may force its allies to bail it out, as in forcing South Korea, Taiwan, Japan, Canada, Australia, the UK, and the EU to buy those dollars, or else … What’s the military for if you cannot use it to force your friends to bail you out?

    • Agree: nokangaroos
    • Replies: @RoatanBill
  7. @Levtraro

    That the US will use its muscle to try to keep the Dollar alive a bit longer is probable. That it will be unsuccessful is also probable. There’s only so much magic the world is willing to believe in and only for so long. Anyone with even half a brain can read the graph of purchasing power over time and there’s little time left before the graph hits the X axis.

    The US’s military strength is deteriorating by the day. That trend has been ongoing since the late 60’s and there’s no reversing it. The shit joining up keeps the numbers in some range to please the dispensers of budgets, but the quality of the individuals is way down from those that entered for WW-II.

    The US military is essentially a mercenary force where the grunt don’t believe in anything but join to get a job to keep their sorry asses alive, to get money for education in exchange for murdering people in foreign lands or, for some, a sick desire to harm innocent people. The military surely represents the worst scum the country has on offer, and they’re going to scatter like roaches when they meet up with a roughly equivalent force. Think of what happened to the Afghan forces at the first sign of trouble. That’s actually the US military “volunteers” as well. Not worth shit.

    • Agree: Old and Grumpy
    • Replies: @JR Foley
    , @Fart Blossom
  8. Yee says:

    A war in Europe or/and Asia, would solve America’s problems neatly…

    • Replies: @Anonymous
    , @Joe Wong
    , @peterAUS
  9. Pity Canada.

    Canada sold off all its gold, and unwisely placed its trust in “financial assets that are easily tradable, and that have deep markets of buyers and sellers.” Canada cannot use its own discretion in where it diversifies its portfolio, it must follow every sanction and every hostile move America makes in this dance with Russia-China.

    Canada, which once had 1000 tons, now has zero gold reserves, and must follow every policy directive issued by Washington. If Washington says you must jump without a parachute, Canada must do it.

    The only thing keeping Canada from declaring bankruptcy is the fire sale of land, and the unprecedented immigration which turbo-charges a housing shortage.

    https://resourceworld.com/none-canada-sells-gold/

    • Replies: @Stebbing Heuer
    , @Joe Wong
  10. Rich says:

    If the Fed ignores its mandate and doesn’t get inflation under control, there’s a good chance of the US ending up in a hyperinflationary cycle that destroys not only the poor and middle class that America’s owners don’t care about, but also the rich. A hard tightening along with interest rate hikes will cause a serious recession, but it looks like the only way to save the economy. And the rich usually weather recessions pretty decently. Biden is a one-termer, so they can’t be accused of helping one party over the other, which sometimes seems like it’s been a major concern of the Fed since the Reagan years.

  11. The Fed has a LEGAL MANDATE to control inflation. It is one of the Fed’s only two mandates — to 1) control inflation while 2) keeping the job market strong and tight

    .

    If they don’t follow this LEGAL MANDATE, who will arrest them?

    Their only mandate is to make as much money for themselves and their buddies on Wall Street who made them rich and powerful. I don’t know what they will do, but will not pretend they are saints looking out for working class Americans.

    • Replies: @JM
  12. @beavertales

    Canada is the fifth-largest producer of gold in the world, and has the eighth largest reserves of gold. In any economic meltdown that sees a repricing of gold, Canada will do more than well.

    • Replies: @Anon
    , @beavertales
  13. It’s a racket and we aren’t on the winning team.

  14. Miro23 says:

    It’s a good article, but it still has this residual assumption that the FED and Congress are somehow concerned with the wellbeing of the general public. Protect them from inflation etc.

    The FED is actually there to serve the ZioGlob and give them free money. Realistically, the WEF/Davos hedge fund elite have far more power than any Congressman or administration official.

    The logic seems to dictate that they will be the first to abandon this sinking ship (exit dollar denominated financial assets – US shares AND bonds). Then they can turn their almost worthless paper into real assets like property, commodities, Euros, Swiss Francs etc.

    It’s the Weimar Plan that they already have some experience with.

    The real art is to take out massive dollar loans and use the borrowed money to buy up assets like city centre property. Borrow 50 million dollars – buy a city centre building – then repay the loan after a few years when 50 million dollars is about the price of a hamburger. The Weimar Jews somehow knew that hyperinflation was coming and used this system to appropriate about 1/3 of prime German city centre property (Ref. “Unfinished Victory” by British historian Arthur Bryant, 1940 Macmillan & Co Ltd.)

    The problem with Weimar (from their point of view) was that Jewry took the blame. German hyperinflation climaxed in 1923 and A.H. wrote “Mein Kampf” in 1925.

    A more satisfactory solution would be to run the same system but blame the breakdown on some fabricated exterior event – such as a “Russian hacking” (Cyber Polygon?) collapsing world supply chains, communications and banking.

    That gives them the option of grabbing the assets while at the same time attacking/blaming Russia – and also saving the day – by themselves finding a solution to their own Cyber Polygon creation. Finally introduce their own privately controlled all digital currency.

    They also have better control of the US media than they had of German media during the 1920’s – 30’s.

    • Thanks: littlereddot
    • Replies: @TitusAlone
  15. As a member of the investor class and the leisure class, I am being screwed by the (((jews))) !!!

    • Replies: @dindunuffins
  16. Jon Chance says: • Website

    “If the Nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good makes the bill good also.”

    — Thomas A. Edison

    http://TheMoneyMasters.Com/the-money-masters/famous-quotations-on-banking

    https://HenryGeorge.Org

  17. Sepp says:

    The “FED” is just part of the big show. All the central banks are under control. All the major politicians are under control. All the big banks are under control. All big Pharma is under control. The MIC is under control. And all these state mechanisms have suddenly acted in coordination to ignore constitutions, bills of rights and laws passed by government. They have all become completely lawless.

    Behind the scenes are secret powerful forces at work and we can only catch fleeting glimpses of them.

    Even Stalin did not know what was really going on behind the scenes, so he had Christian Rakovsky, who was an “illuminati” insider, tortured and eventually executed, so that Stalin himself could find out for himself what the “illuminati” were up to by forcing Rakovsky to talk. We have to recognize that the “illuminati” were another layer hiding the identity of those who really wielded power.

    Fed chiefs like Powell, Yellen Bernanke or Greenspan have no real power. They well understand what is in store if they deviate from their orders. The same thing that happened to Gaddafi, Hussein or even Kennedy or Forrestal is what happens to those who reveal too much or step out of line.

    The “money pump” is controlled by far higher forces than the central bankers. They deliberately drained the economy in 1928-29 so that they could eventually seize the gold and force the US to fight WWII for Judea.

    Today they are busy creating inflation, and we can see it all around us. It comes not just from pumping money out of the economy, but by:

    – Throttling down production with their lockstep covid lockdowns
    – Cutting off energy supplies with absurd environmental scare tactics
    – Causing supply chain disruptions through ridiculous covid transport restrictions
    – Clamping off the supply of productive labor through government handouts, preposterous HR policies, vaccine mandates and other Covid restrictions
    – Cutting off supply of meat by shutting down meat processing plants
    – Using wars to bomb grain silos as in Syria and Lebanon
    – Causing wars in grain producing areas like Ukraine, Syria and North Africa
    – Causing grain production decreases through farm policies and subsidies
    – Causing adverse weather through weather engineering using tools like HAARP, Nexrad and Atmospheric spraying
    – Likely they are also involved in a spate of volcanic eruptions causing global dimming
    – Cutting of supplies of inputs and resources necessary for production and manufacturing from Fertilizer to Aluminium to Computer Chips

    So there is evidence all around us that they are deliberately collapsing supply and production all across the planet. They will not be able to simply restart all these supply chains the same way they can create liquidity in stock and bond markets. It is the equivalent to Cortez burning his galleons.

    This is a coordinated attack against the world economy used to feed, clothe and shelter the entire planet. 7 billion people. Since this is happening simultaneous to the release of a bio-weapon “virus” and the coercion of forcing billions of people to inject experimental DNA modifying mRNA gene therapy, we can take a “holistic” view of current events. In a best case scenario the vast majority of us are headed to a totalitarian control grid powered by social credit based panopticon surveillance state. In a worse case we all die and the Judeo-transhumanists live for ever.

    They are taking the current economic and political systems down in a great reset so that they can create their new world order. Ordo ab Chao. Whether the Fed pumps money in or pumps money out is just window dressing.

    • Agree: Truth Vigilante
    • Thanks: Joe Levantine
  18. Sepp says:
    @Sepp

    This 26 minute video lays it all out. After the great reset you will become a robot zombie controlled by AI. You will not be able to determine the difference between the things you do of your own free will and commands sent to you over the internet of living things.



    Video Link

    • Replies: @The Alarmist
  19. The basic principle when dealing with inflation is the conversion of cash to equities means that you own a share of the capital assets of the corporation (plant, property, equipment), so as the dollar devalues, what you physically own in share stays worth what it was worth.

    So, I don’t know where this idea of a “stock dump” is coming from.

  20. These are the inevitable results of Communism for the rich, which is all it’s ever been about. What surprises me is how long it’s taken to reach this point, how few will learn anything from it, and how the big thieves will get away with mega larceny once again.

  21. @Sepp

    Hey Sepp, don’t you know that it’s all da gubbermint’s fault and that the powers behind the thrones are lily-innocent?

    😉

    Excellent comment.

  22. JR Foley says:
    @RoatanBill

    Canada might just be game for 7 trillion –Australia kicks in 6 trillion–England kicks in 12 trillion and suddenly–USA is only 5 trillion in Debt —Ring around the Rosey ???

  23. @RoatanBill

    The US military is essentially a mercenary force where the grunt don’t believe in anything but join to get a job to keep their sorry asses alive, to get money for education in exchange for murdering people in foreign lands or, for some, a sick desire to harm innocent people.

    They also need money to pay for all the “kool” tattoes and they probably get free sex change operations and tummy tucks as well. And besides that, the “heroes” can apply for and likely obtain sweet “disability” handouts and other freebies for life.

  24. @PDXLibertarian

    What is a corporate piece of capital equipment worth if the other inputs (energy, raw materials, etc.) aren’t available to put it to work and the consumers can’t afford whatever it manages to produce anyway?

    • Replies: @Jon Chance
  25. The Fed has a LEGAL MANDATE to control inflation.

    The FED is an illegal banking cartel. Nothing it does is legal.

  26. tosca says:

    There has never ever been a spontaneous finacial crisis. That simply does not exist and economists do not dare to say so. The 1929 depression took at least 10 years to organize. Bernanke admitted. 7 years of fat cows and then 7 years of cutting the wool on the fooled sheeps’ back. Sorry, clear as rock water. The immense financial power has reached such a level of concentration, that no place has been left for chance . Simply put, it is strategically planned. Covid hoax has been coordinated in scores of countries.
    In my modest opinion, the 2022, (6), crisis is being planned and concocted since 2008, at least. Heard what Ch. Lagarde said to journalists about numerology and number 7? No? Then, you should.

    • Replies: @Fart Blossom
  27. Barr says:

    Tsunami to unfold will upend political -military shenanigans both outside and inside of USA . Foreign money will pull out of India and other countries . India is least prepared to withstand it . This will impact Indian social stability and India’s commitment to QUAD . India might fall back on the options of mad scale slaughter of the Christian Muslim and Buddhist .
    China might bail India out and force coexistence between Pakistan and India as British did to the local kings and to the feuding African tribes in the colonial time.
    The emerging turmoil in Europe could turn out to be the preordered bunker for US and UK to sleep the trouble off . Great escape hatch from turmoil at home . But the nightmares will decide the behaviors while awake and asleep . Others are awake and not planning to share bed with US -UK. It’s not looking good . No escape form the Narco . It leaves dead bodies in alleys , homes , shelters and hotels . The party is ending but the guests and host have nowhere to go .

    How bad the impact will be on the society ?
    Homelessness , domestic violence. suicide , drug , heroin treatment center, cannabis as remedies of spirotuAl and physical agonies , labeling the Narco abuse as diseases ,school shootings, teen pregnancies , open border and sexual permissiveness and overarching corruptions have dotted the lay of the lands of the US fabric of society from 2003 and got worse from 2008.
    I guess cannibalism , IED and , beheadings are left .

    But the world would be a better place and America can redeem itself by thinking outside the box of the exceptionalism .

  28. @Steven Wytyshyn

    Shall I light the ovens, mein herr?

    • Replies: @Gidoutahere
  29. BS,cough,BS,BS,cough,cough,BS “cannot find enough laborers for the numerous jobs offered, and official headline unemployment is very low,” Bs,cough,BS,cough,cough,BS,BS…

  30. profnasty says:

    I find macro economics extremely complicated. Throw in some politics, war, international drug trade, welfare, Healthcare industry. Mix it up and serve it hot.
    Now eat it all up.
    EAT IT!!!

  31. Bob P says:

    Fairly sound reasoning, but I have a few objections. First, since when is the Fed concerned what it can legally do? Was it legal for them to hand out \$16 trillion to banks under the table after the 2008 crash?

    Second, no matter what the Fed would like to do (or must do, according to the article), it can’t raise interest rates anywhere near high enough to stave off inflation because that would bankrupt half the businesses in the nation and put all governments in default. It might raise interest rates by a measly 0.5% or so in the next month or two or three, but that’s a piss in the ocean. Official inflation is 7%; actual inflation is 15%. To have any impact on real inflation, interest rates would have to go to double digits. Impossible.

    Third, politically, there will be staunch pushback from the Democrats against raising interest rates. What little room the Fed has to raise rates will do little against inflation but it will put the brakes on an already slowing economy as the November elections loom.

    Anyway, didn’t we read last month that measurement of inflation is changing as of this month? Just define inflation out of existence, at least according to official stats. MSM will dutifully report how inflation is falling even as a gallon of gas goes to 5 bucks. Problem solved!

    • Agree: Jim Bob Lassiter
    • Replies: @Joe Levantine
  32. Neuday says:
    @Stebbing Heuer

    Didn’t the Fed also have a “legal mandate” to control inflation in the 70’s. All they did was simply change the method used to calculate the CPI (consumer price index). There no reason at all why an lb. of steak couldn’t be swapped out for an lb. of processed insect protein. Besides, an lb. of steak is too much; 14 oz. is a healthier size. Abracadabra, inflation is low, so money printer still go brrrr.

  33. @Sepp

    We are witnessing the great human cull of the designated useless eaters. That would be most of us. Some of the managerial classes will be surprised to discover they too are useless eaters. Wish the truckers, barge operators, and longshoreman would go on strike all over the world so as to get a better definition of useless eater. Davos crowd might be in a bit of a shock to find out true real life value of a gnat.

    • Replies: @Sepp
  34. HT says:

    Jew economics. Force the public to invest in stocks because of zero interest rates and then pull the plug after destroying the value of the dollar. And guess who winds up richer than ever?

  35. HT says:

    When the Jews did this to the Weimar Republic, the German people responded with Hitler. Do we have a push back like that against Satan’s chosen people coming? I doubt it. Whites are so conditioned now that even when they think negative thoughts about the Jews the word “holocaust” goes off in their brain like a blinking neon light.

  36. @tosca

    There has never ever been a spontaneous finacial crisis. That simply does not exist and economists do not dare to say so. The 1929 depression took at least 10 years to organize.

    All true.

    In fact, from one of the original Communists, who in 1841 wrote,

    It is to the direct self-interest of bankers to expand
    and contract the currency, in order to raise and
    depress prices, and force men to sacrifice to them,
    through brokers, sheriffs and auctioneers.

    -Clinton Roosevelt, The Science of Government, Founded on Natural Law, (1841). p37
    https://ia600707.us.archive.org/29/items/sciencegovernme00roosgoog/sciencegovernme00roosgoog.pdf

    The Roosevelt clan has been screwing America for a very long time!

  37. Anonymous[160] • Disclaimer says:
    @Yee

    A two-front war it will be.

    • Replies: @Yee
  38. @Bob P

    “ Was it legal for them to hand out \$16 trillion to banks under the table after the 2008 crash?”

    We all wondered about the dramatic hike in the repo market in September 2019. Just a little while ago, after the fact as usual, the Fed very quietly revealed in a paper that it had to bailout three banks that were in trouble for having bet wrongly in the stocks derivatives to the tune of 4.5 trillion USD. The banks were JP Morgan, Goldman Sacks and Citi Bank

    It is one big club and you ain’t in it- George Carlin.

  39. Rooster12 says:
    @Stebbing Heuer

    Lol, perfect comment, that’s what I was thinking too as I read this. This guy probably still believes in the Easter Bunny! The market is as fake as WWE wrestling!… still entertaining, but fake. They can change the rules as often as they like, and no one even notices, heck, most the talking heads on tv will try to even cover for them and explain it all away.

    The goal of those in charge is to rape and pillage as much money away from the people as possible, and keep the charade going on for as long as they can. The raising/lowering of interest rates is completely political at this point since it doesn’t much matter because the train lever has been jammed forward and we’re going off the broken track on the bridge ahead.

    They will allow inflation to run rampant because to them the alternative is worse. It’s a choice of hard times now to ultimately save our country and financial system OR keep the status quo going a little longer and not rock the boat… they will always choose the latter. At this point the best Powell can do is pretend to raise rates, maybe even actually do it once or MAYBE twice, but that’s it, the show is over not too long from now. Then, they try to roll us into a completely digital currency, at which point we may as well be living in the matrix. Fun times ahead!

    • Agree: Joe Levantine
    • Replies: @Stebbing Heuer
  40. @goldgettin

    i believe you have a few extra zero’s on that monthly amount..? The largest holder of US debt is US citizens. If you have a money/market account or a bond mutual fund, chances are you are a holder of US debt. And the largest single foreign holder is Japan, followed by China.

    See here – https://www.thebalance.com/who-owns-the-u-s-national-debt-3306124

    (Not to take away from you valid points.. )

  41. gay troll says:
    @Rich

    The market has been faked beyond its breaking point. The only question is which direction it will fall.

    A recession/depression would cause politicians to be voted out of office. Hyperinflation would cause politicians to be dragged out of office and hung from lamp posts. Their preference should be clear.

    The market was also magically levitated for COVID lockdowns. I think that was part of the psyop: sure, the new normal sucks ass, but at least the stock markets are hitting a new all time high every week! I don’t think it’s a coincidence that the COVID narrative and the everything bubble are crumbling in tandem. I think that trend will continue.

    Then again, this nation and its citizens sure do have a lot of unpayable debt. But it is unpayable even at 0% interest.

    It would be wise to consider that in the case of an unstoppable force, there is actually no such thing as an immovable object. What goes up must come down.

    • Replies: @Joe Levantine
  42. Joe Wong says:
    @Yee

    Wars only fatten the pockets of MIC, Wall St, and the 1%, and it will make USA’s national debt problem worse; solving America’s problems is a mission impossible. Breaking up the USA and making the USA a dead/non-existence entity is the only way to solve America’s problems.

  43. @Stebbing Heuer

    “Canada will do well because it is the fifth-largest producer of gold in the world”

    Like South Africa is doing well because it produces gold?

    Canada doesn’t believe in a sovereign wealth fund. It gets raped for its resources and says, “please sir, may I have another”.

    • Agree: Joe Wong
    • Replies: @JM
  44. Joe Wong says:
    @beavertales

    Selling off gold reserves to Russia, China and other nations is NATO nations’ plan to rip off Russia, China and other gold buying nations. The NATO nations will start invasion wars like the Opium wars,
    Eight-Nation Alliance wars, or Iraq Wars to grab those gold back.

    There is no insane mentality in NATO pirate nations, only more insane mentality in NATO pirate nations.

  45. Jon Chance says: • Website
    @Jim Bob Lassiter

    High-quality moderate-PE equities represent valuable capital and productive capacity.

    Bonds, mortgages, and bank currencies represent debt.

    Does it make more sense to own capital, or to own debt?

    In my opinion, the entire financial establishment should be in prison for their numerous crimes — such as stealing people’s wealth by selling them bonds, mortgages, and bank currencies (so-called “savings”) rather than informing the public how to invest in productivity (high-quality moderate-PE equities) and attain financial independence.

    • Replies: @Jim Bob Lassiter
  46. Sepp says:
    @Old and Grumpy

    This “Future Leaders” program sponsored by WEF has trained so many of these lackies. I think it explains what happened to Freemasonry: they simply moved on to a new platform. These “leaders”, more correctly puppets, include the likes of Blair, Johnson, Adern and Macron are the equivalent of high level Masons in the last century. As you say, they will be in for big shock when they find out that they are 100% expendable and can be replaced by someone younger and more willing to do whatever is required in order to get ahead and enjoy all the satanic material rewards. Here is what Rakovsky said about the Freemasons before he died in Stalin’s “purge”:

    “the expression of stupidity on the face of some Freemason when he realizes that he must die at the hands of the revolutionaries. How he screams and wants that one should value his services to the revolution! It is a sight at which one can die… but of laughter!”

  47. @gay troll

    “ A recession/depression would cause politicians to be voted out of office. Hyperinflation would cause politicians to be dragged out of office and hung from lamp posts. Their preference should be clear.”

    I am sorry to disagree. Debt deflation would bankrupt the banks while high inflation is tantamount to an indirect tax on the people. Between the people and the banks, so far, American politicians have always favoured the banks. The Fed’s only option is to keep inflating to a point where it will burst the all bubble economy once a CBDC has been imposed on the desperate people at which point surrender by the common folks would be a final descent into eternal slavery.

  48. nsa says:

    Econ 101: the demand for free stuff from all segments of amelikan society is insatiable. So your rulers dole out the freebies by borrowing dollars and then paying off the debt with fifty cent pieces, then quarters, then dimes. Rule of 72 example: Run inflation at 10%, claim 6%, borrow at 1.5%. 72/(10-1.5) = 8.5 years i.e. purchasing power halves every 8.5 years. Borrow dollars….pay back with 50 cent pieces. Scam has been working smoothly since 1913. Hard on savers and productive worker bees, but who cares as there aren’t enough of them to matter.

  49. Actually, there is a way people can protect themselves from buying the wrong stocks. Just buy the stock Nancy Pelosi buys with insider trading. Oh, excuse me, her husband buys the stocks that she recommends but its insider trading never the less, by any other name. Do people really support her? Who are they????!!!!

  50. Here is another bottom line truth – a society that doesn’t build anything cannot stay rich for long.
    It has taken about thirty years for that to finally happen in America. Old Slick Willy shook one his fat fingers and assured America that we were only going to ship the “lousy jobs” overseas – and not the good ones. What he and Hillary failed to mention was that the “lousy jobs” were those that fed blue-collar families and that the “good jobs” were those that enriched their elite friends on Wall Street.
    Only fools believed that NAFTA enabled American industry to go no further than Canada and Mexico.
    Fortunately, the Clintons are still around and could and should be tried in court for having sold America down-river.

  51. because the Fed is running the outflow pump fast and furious,

    The Fed has only slowed the input flow, it has not stopped buying bonds, it has only slowed the rate of bond buying – this information is published by the Fed itself:

    https://www.stlouisfed.org/open-vault/2021/november/what-fed-tapering-means
    How Will Tapering Work?

    The first step in the tapering process will be taken in mid-November, when the Fed will reduce the pace of purchases.

    Treasury securities purchases will go from \$80 billion to \$70 billion a month.
    MBS purchases will go from \$40 billion to \$35 billion a month.

    Then, in mid-December, the pace of purchases will be reduced again.

    Treasury securities purchases will go from \$70 billion to \$60 billion a month.
    MBS purchases will go from \$35 billion to \$30 billion a month.

    If the economy continues to improve as the FOMC expects, then each month the pace of purchases could decline by similar dollar amounts. Assuming the recovery remains on track and the FOMC continues its monthly tapering pace, by mid-2022 the Fed will complete the taper and no longer be purchasing securities that increase the size of its balance sheet.1


    This paragraph is exactly correct:

    During the present stock dump, it’s important to remember that, for the first time in the lives of many investors, there is no Fed safety net under the stock market to arrest its fall, and here is why: The Fed will continue to tighten under inflation, regardless of what stock and bond markets do, because it has to. The Fed has a LEGAL MANDATE to control inflation. It is one of the Fed’s only two mandates — to 1) control inflation while 2) keeping the job market strong and tight.

    The stock market participants got lured into a huge speculative bubble, they are calling this one the everything superbubble, across the board asset values went into the stratosphere. And it is not sustainable, and it will reverse when psychology of FOMO (Fear Of Missing Out) changes to FOLE (Fear Of Losing Everything).

    FOMO –> hyperbubble –> full bullish saturation of speculators –> market tops –> Fed says it has to fight inflation –> Robinhood newbie traders not believe –> Fed slows bond purchases –> smart money gets the hell out –> FOLE –> market panic on a Biblical scale –> crash 2 magnitudes greater than 1929 –> stocks crater 99% –> biggest and longest economic depression which is the unwind of 100+ year Fed intervention and liquidity cycle. (Long cycle of inflation leads to gigantic sudden (and catastrophic) deflation.

    credit cycle up (1913 – 2021) leads to massive Japan style asset deflation (2022-2042) or an outright 1929 deflation deflation.

    Klaus Schwab licks his anal lips: ‘This is our greatest opportunity to make the world in my image, you will own nothing and be happy while my GloboHomo friends own everything.’

    They knew it was going to crash (actually that is a no-brainer) and they knew they could use the crash to their advantage, to re-make the world into a technological police state. Just like 1929 led to confiscation of gold, the installation of a fiat standard, they know everywhere pump and dump scam is how to rip off and herd the Goyim slave population.

    Bottom line: The Fed is going to fight inflation because that is what they are chartered to do.

    This widespread belief that the Fed has the stock market’s back is a false perception that was started when the Fed lowered rates fueling the speculative bubble which made billionaires richer. Now that the bust is here, the super rich are going to lose their asses also. All those who think the Fed won’t raise rates to the moon to stop inflation are wrong.

    The Fed did raise rates in the 1970’s until inflation’s back was broken. If the Fed doesn’t the dollar will crash along with USA’s military empire and dollar reserve status. The system has to protect the dollar or the entire world USA controlled hegemony will unwind. Thus once again it is a no brainer – the Fed is going to protect the value of the \$USD no matter how bad you get screwed by deflation.

    Bitcoin is a short on the entire system. Bitcoin skyrocketing is caused by Fed not fighting inflation fast enough. But when the Fed raises rates BTC is going to crash, and in fact it is already crashing because the FEAR OF HYPERINFLATION is tapering with Fed taper. Thus, Bitcoin is just another bubble in the superbubble.

    10 YEAR TREASURY MEGAPHONE the federal reserve has destabilized interest rates

    • Agree: Levtraro
  52. Levtraro says:
    @PDXLibertarian

    When to curb inflation the Fed raises interest rates the whole economy cools down, increasing the cost of borrowing, reducing investment, reducing disposable income, encouraging saving money in savings accounts, increasing interest on loan payments (including mortgages) and therefore limiting the growth in consumer spending, so both stocks and bonds of companies in most sectors of the economy become less good instruments to park your money. So the idea of a stock dump because of inflation has a mediator through higher interest rates. Ultimately, it is not inflation per se, but how central planners react to inflation: by rising interest rates.

    You can also think of it this way: shareholder’s equity is total assets minus total liabilities. When wise central planners react to inflation by rising interest rates, total assets tend to decrease (see above) and total liabilities tend to increase (see above) leaving less room for having positive equity, ergo you dump your stocks and move into other instruments with less risk, such as fixed income, as you try to take advantage of the fact that wise yahveh-chosen central planners want the masses of deplorable soul-less goyim to spend less.

    But the current situation is unlike anything in the past. Since 1999 downturns are deeper, recovery times are longer, and recovery rates are smaller. A nasty looking cycle. I’ve seen calculations to the effect that in the latest run of the cycle (2008 to the COVID recession) for every 12\$ of liquidity that the Fed has injected the return has been on average 1\$ in subsequent economic growth. A more recent example: at the end of 2018 the Fed tried timidly to taper its QE and nudged interest rate a tiny bit up and the stock market quickly tanked and the Fed recoiled and went back to QE and interest rates drops.

    And yet interest rates have to go up. Soon.

  53. @Rich

    I can’t recall if it was John Kenneth Galbraith but it was somebody like that who wrote a history of the Great Depression and there is a great line in there about the second wave in 1931 where he writes that in 1929 [list of investor classes] got wiped out but then in 1931 everybody else who had managed to hold out that far bit it.

    Have been searching for the exact quote for years but seem to have lost the sucker.

  54. @Sepp

    Does the message preamble they are beaming out to people include the sequence, “SIMONSAYS” ?

    • LOL: Sepp
  55. LET IT ALL GO, DAMMIT! LET THE FINANCIAL MARKETS FIND THEIR PROPER LEVEL!

    The asset bubbles in stocks and bonds and real estate — commercial and residential — must be allowed to undergo PRICE DISCOVERY unhindered by the anti-capitalist machinations of the globalized central banker shysters.

    This is the third frigging asset bubble, starting in the 1990s, that the plutocrat- and privately-controlled Federal Reserve Bank has inflated using monetary extremism — low or zero or negative interest rates, asset purchases, quantitative easing, dollar swaps, direct central bank purchases of sovereign and corporate debt, balance sheet ballooning, bailouts…etc. — and enough is enough, DAMMIT!

    A lot of sonofabitches are saying they want this thing that is so-called “capitalism” and I say give it to ’em with both barrels. Stop the monetary extremism from the Fed and you greedy stupid boneheads will get your damn “capitalism.”

    There is no “capitalism,” you damn dirty ape fools, there is only globalized central banker shysterism. You can’t have any damn thing called “capitalism” when you have a debt-based fiat currency system. The greedy and immoral and evil ones will always use the electronics of an electronic debt-based fiat currency system to their advantage and they don’t give a frigging damn about what is in the best interests of the nation as a whole.

    The hostile and evil and immoral JEW/WASP Ruling Class of the American Empire is actively engaged in attacking and destroying the USA using globalization and financialization and mass legal immigration and mass illegal immigration and globalized trade deal scams and monetary policy and foreign policy and tax policy as a political weapon to kill the historic American nation and to attack and destroy the European Christian ancestral core of the USA.

  56. There is a lot to say about the upcoming unwind.

    1. Junk bonds. Junk is worth nothing. So why is junk down to 3% risk? Hyperbubble positive mood. Eventually junk is going to zero. Go to bigcharts.com and type in HYG of JNK to see charts, and look at how fast junk can drop in a panic.

    2. Margin debt Borrowing to buy more stock is leverage. Leverage is a double edged sword. Currently margin debt borrowing is out of control near a trillion borrowed. Any fast crash to the stock market WILL cause margin calls (just like 1929). Brokers can force sell assets of traders to keep from going bust, which means in a fast stock decline, other assets are liquidated automatically to make margin call. Thus gold and silver WILL crash along with stocks.

    3. Genius fund managers (like Cathie Woods ARKK) are just lucky. When the market goes up there WILL be a few fund managers who are lucky and have greater than SPX ETF returns. Money will pour into these “smart” managers funds. But it is an illusion, only luck. So when the crash comes these fully invested funds will lose everything (like Bernie Madoff) because the entire market is one gigantic Fed fueled Ponzi scheme based on the bigger fool theory. Cathie Woods might lose her mind, be committed or even commit suicide – the higher it goes the more convinced they are god and when it reverses the losses can be so devastating that the fund managers jump from windows.

    ARKK has been crashing BEFORE the current crash along with Disney DIS, Peloton PTON, Netflix, nflx, etc. The unwind was going on in tech before the current decline in blue chips. Thus the market is gaining momentum to crash once everyone realizes that the new trend is down not up.

    ———————–
    Federal Reserve Board Chairman Jerome Powell says what he has been saying and the market plunges on the “news”. Not news at all, just reality setting in that the FED doe NOT have your back. This means FOMO GREED is wearing thin, and once FOMO evaporates, then the opposite emotion of FEAR of losing everything starts to possess the trading public. Just watch and see how the whole fooking bubble pops. This is 100% predictable, bubbles go from extreme optimism and reverse to extreme fear and pessimism.

    Fed plans to raise rates as soon as March to cool inflation

    WASHINGTON (AP) — The Federal Reserve signaled Wednesday that it plans to begin raising its benchmark interest rate as soon as March,

    ———————-

    The Fed Is Fucked And So Are The Lobotomized “Genius” Fund Managers It Has Created
    https://quoththeraven.substack.com/p/the-fed-is-fucked-and-so-are-the

    • Thanks: Sepp
  57. @Jon Chance

    Is that what they teach at Wells-Fargo Financial Advisors cont. ed. courses?

    • Troll: RadicalCenter
  58. The JEW/WASP Ruling Class of the American Empire controls the Federal Reserve Bank.

    The Federal Reserve Bank’s Quantitative Easing monetary policies create price inflation asset bubbles that reward the billionaires and the top ten percent loot holders

    The Federal Reserve Bank is deliberately stoking inflation to attack and harm White Core Americans of modest means.

    QUANTITATIVE TIGHTENING NOW!

    IMPLODE THE ASSET BUBBLES NOW!

    WHIP INFLATION NOW!

    TWENTY PERCENT FEDERAL FUNDS RATE NOW!

  59. 2008, only 700 billions was printed.

    the last 2 years, 7 trillions was printed.

    how big do you all think this new financial crisis will unfold in very, very near future.

    China has been preparing for the last 2 years already, So should you all, we all.

    • Replies: @RoatanBill
  60. The QUANTITATIVE EASING highly accommodative monetary policy of the privately-controlled FEDERAL RESERVE BANK is entirely to blame for INFLATION.

    The Federal Reserve Bank is an Organized Crime Syndicate that is using monetary policy to inflate asset bubbles that mainly benefit the billionaires and the top ten percent loot holders. The billionaires and the top ten percent loot holders get the asset price inflation and regular Americans of modest means get the price inflation in housing, food, fuel, and much else besides.

    The “normal” federal funds rate is 6 percent. How about the privately-controlled Federal Reserve Bank immediately raise the federal funds rate to 6 percent? The globalizer shysters who own the Federal Reserve Bank sent out their former head shyster, Janet Yellen, to spread the word that 4 percent is the new “normal” federal funds rate.

    Paul Volcker got the federal funds rate over 20 percent in 1981 to wipe out inflation. American patriots could quickly retake control of the government if Federal Reserve Bank Chairman Powell immediately put the federal funds rate at 6 percent. The asset bubbles in real estate, bonds, and stocks would implode instantaneously.

    Remember, the shyster central bankers in the United States kept wage inflation in check by sending factory jobs overseas and by importing cheap labor in the form of mass immigration. The central banker shysters then used financialization to massively transfer wealth from the middle to the plutocrats.

    The percentage of corporate profits going to labor has plummeted in the last few decades.

    The baby boomers must be financially liquidated. The baby boomers should have been financially wiped out back in 2008, but the Federal Reserve Bank bailed them out.

    Zero Interest Rate Policy; asset purchases; money printing; dollar swaps; ballooning the balance sheet of the privately-controlled Federal Reserve Bank with worthless mortgage-backed securities; all this was done to save the greedy baby boomers. The baby boomers used mass immigration, globalization, financialization and monetary extremism to steal the future away from future generations.

    The baby boomers are evil and will deserve the curses of those who come after. Except for that hirsute English guy Peter Brimelow who loves the Hibernian gals, and some other baby boomers who told the truth.

    Andrew Jackson understood the money-grubbing shysters behind central banking; the baby boomers are Nicholas Biddle in generational form.

    NATIONALIZE THE FEDERAL RESERVE BANK NOW!

    • Troll: RoatanBill
  61. ricpic says:

    We’ve been on the edge of catastrophe for what? a decade? two decades? and it hasn’t happened.

    Color me skeptical that it will happen this time.

    How will catastrophe be avoided?

    All I know is that the hat they pull the rabbits out of is bottomless.

    • Disagree: RadicalCenter
  62. @Astuteobservor II

    The Dollar is already dead. It just hasn’t hit the floor yet. With the US’s national debt, the loss of purchasing power and an economy purposely hosed over for the covid nonsense, there’s is no way to prevent the hyperinflation that’s been planned to clean the slate.

    Anyone holding gov’t paper will get nothing. Social Security, pensions, all the entitlement programs, etc are all going to disappear. Any attempt at a CBDC will work only inside the US where the peasants can be forced into using another pile of worthless promises. International trade will only work with tangible commodities as barter. Gold and silver will be part of that mix along with oil, food, machine tools, etc. No one in his right mind is going to accept some other gov’ts paper promises in the very near future. In god we trust – everyone else pays cash.

  63. TheJester says:

    The worse things get, (((they))) will need another war. WWI and WWII were not accidents. Wars, like Covid X, create “emergency conditions ” that easily justify, they presume, emergency financial and authoritarian social instruments.

    The United States is like a wounded predator struggling for survival. It will fray and posture to create the illusion of impotence, and recklessly strike at anyone or anything that questions its narrative.

    The recent Ukrainian crisis is a case in point. It was a predetermined stage play. The CIA pulled out the prewritten storyline and gave each actor its instructions and lines. Ouch, the stage play even included predetermined reasons to force the Russians in the Space Station to isolate in their module. [?] An instantaneous pushback on all fronts. It was embarrassing!

    I’m a pessimist. I was involved in NATO exercises in Europe in the 1970s. How can Americans, British, French, Dutch, and Germans pretend to launch a unified front against the Soviets, a.k.a. Russians. It was absolute chaos! My German friend in the Luftwaffe related that the NATO plans included blowing up the bridges in the face of the Soviet onslaught before the West Germans forces had retreated across the bridges … and the West Germans constituted the core to the Allied response.

    We once ran an air defense exercise with American, German, and French air forces. It went like this: we had to find an American who spoke German and a German who spoke French in the hope that the intermediary could communicate speed, altitude, and target information from the American radar site to the French fighters. Things did not go well!

    Now NATO believes they can coordinate effective combined operations consisting of forces from 30 countries speaking a babel of languages against the Russians? FANTASTICA … DEMENTIA!

    • Replies: @peterAUS
  64. I can’t see an end to marriage between Fed and Big Gov. They feed off each other. When the divorce actually comes, and it must, we need to be ready, which means, we need new blood at the top. We need strong leadership who will at whatever the cost, kick the Fed out, and return this country to pre-1913 sound money. That means a dollar based on labor and production; a real GDP.
    Tempoarily seize the Banks, media conglomerates, and criminal corporations like Pfizer, and Microsoft, close the borders, bring manufacturing home, close 90% of our overseas military bases, end the reign of the Rockefeller Foundation and all their clones, the CIA, FBI, NSA etc., and support real Christianitian principles, and the family. Do you get the picture? It will have to go something like that.

    • Agree: Brad Anbro
  65. I agree with the author the Fed is going to raise interest rates to fight inflation. How high rates go depends on how much inflation. If you search these terms: fred chart balance sheet you can find just how much the Fed has ‘printed’. (FRED is the Saint Louis Federal Reserve Economic Data)

    https://fred.stlouisfed.org/graph/?g=i6u6

    What everyone is freaking out about is the rate of inflation. It is calculated by the change over 12 months ago. It is currently 7%, that means prices are 7% higher than 12 months ago. It is the rate of change that everyone is worried about – because it is accelerating – and because the Fed balance sheet – the shitload of bonds they have bought – went up 4 trillion.

    Assets: Total Assets: Total Assets (Less Eliminations from Consolidation): Wednesday Level (WALCL)

    ————————–

    Handy bookmarks:

    Fed balance sheet: https://www.yardeni.com/pub/fedbal.pdf see Figure 5.

    https://tradingeconomics.com/united-states/inflation-cpi (click on max length)

    https://fred.stlouisfed.org/series/CORESTICKM159SFRBATL (this shows how the Fed has been targeting 2% core inflation)

    https://www.bls.gov/bls/newsrels.htm

    • Replies: @Levtraro
  66. Yee says:
    @Anonymous

    A two-front war it will be.

    Doesn’t matter. The US don’t need to win, just throw Europe or/and Asia economy into chaos, America would automatically become an economic safe heaven. Whatever problems it has would be better than war zone economy.

  67. We were led to believe the Chosen People are financial experts! What other lies are being told?

  68. Mehool Bhai here
    Not only will Amrika destroy global economy because of Fed scam, China will destroy us too.
    James Gorrie, a political economist has authored “The China Crisis: How China’s Economic Collapse Will Lead to a Global Depression”. Gorrie bhai in the video below says that factors of production in China is10 times that of Amrika because of corruption etc… Allowing businesses to flourish and then sucking the life out of them. Circular financing. A top party official will see some successful factory, takes it away, sucks out the money, sticks the money in Geneva or Hong Kong and then they would get a loan from the People’s Bank of China and refund/recapitalize it with borrowed money. So they take money out and then refinance it with loans, a circular funding scam. The PBC is owned by the Chinese Communist Party. So it is circular movement of money with lots of money being stuffed in overseas accounts of Communist Party members and there is lots of debt in the economy. They looted out Jack Ma and other big tech companies using similar technique and also because Xi is fighting a mafia turf war with the Jiang Zemin mafia faction, Jack Ma was close to Jiang.

    What the Chicom elites are doing now, since their own economy is crashing, they are getting Amerikan and European greedy banker types, roping them in, so that Chinese risks will be spread around the World. So not only will the Amriki economy destroy world, Chini economy will too!!

    Cannibal Capitalism: How China Eats Its Own
    Both, cursed Amrika and cursed China will destroy us.
    —Concerned and scared, Mehool Bhai, Mumbai.

    • Thanks: JM
    • Replies: @littlereddot
  69. JM says:
    @beavertales

    Canadians appear to be the most PC people in the West and more so than Australians (note our National Future Fund on Wikipedia).

    Probably due to the close geographical proximity to the USA Money Power if cause could be teased out from the cultural subversions and its agents like that little rat of a “Prime Minister”.

    Don’t get me wrong, there are many parallels with Australia.

  70. JM says:
    @Carlton Meyer

    I don’t know what they will do, but will not pretend they are saints looking out for working class Americans.

    Well when the traditional “representatives” of labor don’t do it, what chance is there with Wall Street and the Rothschild owned Fed????

  71. Levtraro says:
    @Yukon Jack

    What everyone is freaking out about is the rate of inflation. It is calculated by the change over 12 months ago. It is currently 7%, that means prices are 7% higher than 12 months ago.

    That rate does not take into account a sizable component of CPI: housing; due to the lag in rental contracts (about 8 mo). My friend tells me to add between 2 and 3 percent points to headline CPI.

  72. peterAUS says:
    @TheJester

    Wars, like Covid X, create “emergency conditions ” that easily justify, they presume, emergency financial and authoritarian social instruments.

    Yep. Proper wars, though. Ukraine option looks of that type if….IF…managed carefully.
    Big IF.

    As for

    …I was involved in NATO exercises in Europe in the 1970s…..

    That was a long time ago, especially re:

    Now NATO believes they can coordinate effective combined operations consisting of forces from 30 countries speaking a babel of languages against the Russians?

    Almost all officers, down to company level, speak workable English now.

    There ARE a couple of scenarios where NATO would work well in the conflict in Ukraine.

    There is a problem, though. I guess you do remember Soviet doctrine at the time.
    I am not sure Russia changed it; maybe tweaked a bit.
    So…..what happens if Russians do attack and get bogged down in front of a city in Ukraine? “Solution” from the doctrine above?!
    THAT is the problem.

    • Replies: @RadicalCenter
  73. Fire Sale The Fed Balance Sheet Now!

    Dump Everything!

    Nationalize The Fed Now!

  74. @peterAUS

    Right. And not only officers but all european soldiers know some English.

  75. @Mehool Mehta

    Whatever happened to Make in India? Or all the other fancy things that Modi promised?

    • Replies: @Malla
  76. I have been prepared and ready since 2012.

    The collapse is taking a surprisingly long time.

  77. @Miro23

    It’s the Weimar Plan that they already have some experience with.

    I totally agree. I also fully agree with your opening statement. It would be naive to suppose that these monetary authorities are remotely concerned with the common good, or legality, or their mandates and responsibilities. These are not very convincing covers for their real activities.

    They have been trying to start up high inflation for some time. It didn’t work, (for various reasons) and another international banking crisis, worse than 2007, was on the way in 2019. But then – hey presto – Covid turned up, and saved the day. Everything had to be put on hold, and lots of money printed …

  78. Malla says:
    @littlereddot

    Whatever happened to Make in India?

    What Mehool uncle will not tell you is that the companies who have responded the best to Modi’s Make in India, are Chinese Companies. If there has been any little success of Modi’s make it India, it is mostly because of Chinese companies opening factories in India.
    Then they Indian nationalists will scream that Chinese foreigners “will spy on motherland” and “make us slave”. If the Chinese leave, the Nationalists will cry why no one wants to come to our great India and everybody is going to Vietnam. They are a bunch of idiots.

  79. This time is different — very, very, VERY different

    Good grief, I’ve been reading about the imminent collapse of Wall Street since the first oil embargo back in ’73. Ask yourself about the class that owns 80% of common stock and whether they would allow the institutions they set up to extract that wealth from the rest of us to ever fail..

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