One issue the financial media is willing to ignore, but has been foremost in my mind for many years is the utter recklessness of the Federal Reserve’s ‘monetary policy.’ Below is a chart the public will never see on CNBC, or anywhere else, but I believe is vital to understand the threat that Washington and Wall Street currently present to the world at large. You’re looking at what academic-quack economists have done to the global reserve currency to save the hides of the banking elite, who for decades have acted as if Wall Street was their private fiefdom.
The FOMC calls this ‘monetary policy’ but for me something completely different comes to mind: legalized counterfeiting. Unfortunately, for years the baby-boomer generation (and their children; the Gen-Xers) have sought pleasure in immediate consumption. It’s hard to blamethem since the Fed destroyed their incentive to save by lowering the Fed Funds Rate to nearly 0% in December 2008. This rate can never be raised (despite the Fed rhetoric) without blowing up the budget deficit, sinking the economy in the process. For decades American’s, (and just about everyone else) have taken full advantage of the debt generously provided by the banking system to leverage their income, and now far too many people are hooked on cheap credit and just one paycheck away from insolvency, as are their employers.
This post was published at Gold-Eagle on August 24, 2014
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