Short term business press promotes that the FED and Wall St. insiders were right in saving the system they imploded by creating trillions of dollars out of thin air and loaning it to themselves at 0% in exchange for assets marked to market that are worth nothing, at which they stuck future taxpayers with by privatizing their profits and socializing their losses.
Meanwhile every financial curve tied to debt has exploded exponentially and they have no more suckers to milk with this ponzi scheme which will eventually implode. In order to keep it stable they have to pump 90 billion dollars a month into Wall St., but hey these guys have saved us all. What a load of crap.
If you want to see someone who actually saved themselves from this never ending ponzi financing, look at how Iceland handled the situation. It didn’t involve rewarding the guys who blew up the system, it did involve cutting their losses and taking their medicine.
Good points but the interesting thing is the Fed can keep printing money to prop up bonds, stocks and member banks without authorization from Congress. They only need authorization to allow member banks to buy US Bonds in return for federal reserve notes.
It’s even more interesting that the specter of inflation is kept at bay by strict money lending to the private sector.
The Fed is holding a lot of debt. To continue the charade in propping up member banks they must allow bond sales to China and others who think bonds are a safe haven. But ever more bonds at virtually zero to negative interest rates leads investors such as the Chinese to become disgruntled. The Chinese have been trying to dump the bonds they have.
Without willing bond investors, the Fed finds themselves in a quandary as to how to keep the charade going. They want the debt ceiling raised to keep their member banks as primary bond investors buying paper from the US government without worrying about what China will or won’t do.
Without the US Government selling bond paper in exchange for Fed paper (go over the ‘cliff’), the supply of bonds defaults to corporate and local bonds but those risk kindling inflation in the private sector.
The only way out is to raise interest rates which will choke US Spending which to us as conservatives is a good thing but it means cuts in military, cuts in research and universities, strangling the auto industry (housing is already near dead), and eventually cuts in medicare and social security. None of it will be good and the only question is who will be successful in laying blame, Obama or the GOP House?
The GOP was and is stupid. They put the debt ceiling off until after the election. Gawd they are so stupid it is maddening. Had they let the chips fall where they may, Obama would have been been in flight away from the raging anger of voters. Bu then we would have had Romney who is RINO to his core.
So Obama is not going to be blamed right away. The public may have difficulty accepting the MSM campaign to blame the republicans but someone or some group is going to catch Hell somehow. It is possible that the public can be led to focus on Sheriff Arpaio’s findings and this can lead to Obama being ousted. This could be a relief valve for venting the certain anger to come. This sounds like a long shot but blame and anger will find an outlet somehow. There has to be a sense of justice, a scapegoat.
If the GOP caves on the debt ceiling which I expect them to do, then investors from Moscow to Dubai to Beijing are going to continue forward with more speed to replace the US dollar as the world’s reserve currency. To do this Russian oil needs market share from the Saudis and Euros becomes the reserve currency. Doesn’t matter that Europe is in a depression. What matters is the oil traded in Euros and the Russians are happy to do that with the Chinese.
But for Russian oil to get market share they need to displace Saudi influences. Saudis are content to allow the US dollar to hold as the reserve currency because they invest in gold anyways. The world’s richest person is Prince Alwaleed, worth 26 trillion US dollars half of which is in gold.
And that brings us to the point of Bengazi, Iran, Hamas, Libya and Syria. That theater is a chess match between Saudi and Sino-Russian powers with the US backing Saudi interests via usage of the US military and intelligence assets as mercenaries.
What else could focus the public’s anger and quest for a scapegoat or a diversion? A war somewhere. But then watch oil and gold soar and that in turn means inflation at home. People are going to hurt, Americans are going to hurt. who will be the Bogeyman?