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Forget the
market machinations utilized to put lipstick on yesterday’s FOMC pig,
and the MSM’s brain-dead “take” on Fed policy. Forget the
gold plunges and Dow surges, calls for an “end to QE,” and
– conversely – its expansion to “INFINITY.” Instead,
consider what the Fed has done – and ALL Central banks throughout
history – what they are doing now, and what options they have for the
future.
Throughout
the annuls of history, no fiat currency has ever
survived – EVER. Moreover, in nearly all cases, 40 years has been the
longest period before either a major devaluation or collapse has occurred.
in fact, the vaunted United States has already lost
two currencies, nearly three, and shortly the 41-year old post gold standard
dollar. The U.S. Continental and Confederate Dollar were hyperinflated to pay for the Revolutionary War and the
South’s Civil War costs, while Abraham Lincoln’s Greenback
was within months of the same fate when the Civil War ended.
I
don’t use the term “Ponzi Scheme” loosely, but that is
EXACTLY what the Federal Reserve perpetrates. By definition, a Ponzi
Scheme must endlessly GROW to remain viable, despite the fact that its
infrastructure rapidly weakens. Once confidence in the fragile base
breaks, the pyramid collapses. Which is what happened to EVERY fiat
currency in history, and will shortly with the ENTIRE GLOBAL MONETARY SYSTEM,
tethered at the hip to the “world’s reserve currency”
– the U.S. dollar.
The title
of this RANT relates to Bernanke’s “EMPTY SACK” of policy
tools, having exhausted ALL but its “last ditch” DOOMSDAY weapon,
which in many respects has already been deployed. Interest rates were lowered
to ZERO three years ago, and even “comforting” the market by
stating they will stay there until “at least late 2014″ –
or perhaps “late 2015,” per recent comments from Fed Vice Chair
Janet Yellen – have done NOTHING to slow debt
creation, unemployment, inflation, or the housing bust.
Bernanke’s
Right Hand Dove, Janet Yellen, Hints At ZIRP
Through Late 2015
The Fed
has also utilized a number of confusing MONEY PRINTING schemes –
couched in confusing “Fedspeak” to
obfuscate their meaning – including the “swap facility”,
“Operation Twist”, and the ridiculous, oxymoronic
“Sterilized QE.”
Jim
Sinclair: QE ‘Sterilized’ is ‘Jumbo Shrimp’
However,
NONE of these policies have resolved the nation’s – or
world’s – problems, which, conversely, have dramatically
worsened. Economic data is collapsing - as are most financial markets
– while global INFLATION has reached its highest level in decades, led
by gasoline prices, currently at an ALL-TIME HIGH. Worse yet, the two nations
home to nearly half the world’s population – China and India
– have among the highest inflation rates, yielding fears of food
shortage, gas rationing, and social unrest. The dollar-anchored fiat monetary
system is the root cause, and until it is DESTROYED and REBOOTED with gold
backing, the vicious circle of inflation, unemployment, and social
instability will continue.
Yesterday’s
FOMC statement resembled a “deer in headlights,” in my view. The
Fed KNOWS its policies are failing, KNOWS the global economy is rolling over,
and KNOWS inflation is so high, it cannot afford to overtly announce a
new QE round. That’s why Bennie is praying for a market
collapse, hoping with all his might that a late 2008 scenario will
occur – plunging stock prices AND commodities, enabling his DOOMSDAY
weapon to be deployed. However, methinks he won’t be so lucky this
time.
In 2008
– and even 2011 – the Fed’s “SACK” was full of
MONEY PRINTING REMEDIES, engendering TBTF bailouts and dramatic expansion of
its own balance sheet – i.e., that of the TAXPAYING CITIZENS.
This time, however, his sack is “EMPTY.” This is why the PAPER PM
attacks have been so strong since last Fall’s Global Meltdown II
– and conversely, the PPT’s maniacal support of the “DOW JONES
PROPAGANDA AVERAGE.”
Bennie
also KNOWS he cannot even remotely pretend QE might be discontinued
– overtly, that is, as covert QE will NEVER stop.
However, due to the aforementioned issues, the best he can muster is letting
us know he’s “open-minded,” issuing the following, feeble,
pathetic comments. But make no mistake, “more balance sheet
actions” means MASSIVE, OVERT QE – and hence, exploding
inflation – and nothing more.
- BERNANKE SAYS FED PREPARED TO
TAKE MORE BALANCE SHEET ACTIONS
- BERNANKE SAYS `THOSE TOOLS
REMAIN ON THE TABLE’
As for
“tools on the table,” he is bluffing. There are NONE, just an
“EMPTY SACK,” and LIES, LIES, LIES…
5 New Lies
That The Federal Reserve Is Telling The American People
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