Please remember that when people talk of the Federal Reserve it is NOT owned by the Federal Government. In fact no one is quite sure who OWNS it but most certainly it was started with input and funds from foreign bankers. If you look it up you will see names that are also the same names you will see when talk comes up of the GLOBAL ELITE.
So how is it that the Federal Reserve can "BUY" U.S. Treasury bonds...when they don't really have any money? Who makes the decision to flood the USA with $billions every month in an effort to jump start our consumer society? How do they decide when to pull that money out of the economy? How can they pull out the $trillions that they have created out of thin air without sinking our entire economy into a depression that would make the 1930's look tame?
Now check out this article that was in the Wall Street Journal today written by Phil Gramm, former Senate chairman of the Banking Committee.
I will post the very last paragraph first so you can see the reason for my blog posting title.
Never in our history has so much money been spent to produce so little good, and the full bill for this failed policy has yet to arrive. No such explosion of debt has ever escaped a day of reckoning and no such monetary surge has ever had a happy ending.
Now here is how the article starts;
With the Senate Banking Committee on Thursday approving Janet Yellen's nomination to lead the Federal Reserve, her confirmation is virtually assured. Less certain is what Ms. Yellen ultimately intends to do with Fed policy on quantitative easing, now entering its 34th month. She is committed to maintaining QE for now, but does she have an exit strategy? The Fed needs one, because the economic stakes could not be higher.
If we listen to the Fed governors, the potentially explosive increase in the money supply inherent in the current $2.3 trillion of excess bank reserves won't be allowed to occur. At the first sign of a real economic recovery, the Fed will sell Treasurys and mortgage-backed securities (MBSs) to soak up excess bank reserves, or achieve the same result through repurchase agreements and paying banks to hold excess reserves.
It sounds simple, but in a full-blown recovery the Fed will have to execute its exit strategy quickly enough to keep the inflation genie in the bottle without driving interest rates up to levels that would derail the recovery. And every month that the Fed's monetary expansion continues, its exit strategy becomes more difficult and dangerous.
The last time the Fed tried to absorb the excess reserves of the banking system by dramatically raising reserve requirements was in 1936. Then, a less than doubling of reserve requirements helped send the economy back into the depression.
The weakest recovery in the post-war period was bought with a fiscal policy that doubled the national debt held by the public and a monetary policy that expanded the monetary base at a rate not approached in the modern era. The monetary expansion that started as a response to the subprime crisis has evolved into a prolonged and largely unsuccessful effort to offset the negative impact of the Obama administration's tax, spend and regulatory policies.
I smile at people who shrug when talk turns to another Depression....they say, "Oh well, we made it through one 70-80 years ago and we can make it through another one."
What?? Umm....YOU never made it through a Depression...plus the people of today are NOT made from the same stock that our grandparents were made of. During the last one most of America was living on subsistence farms and had a chicken and pig in their back yard and 70% of the country had no electricity.
Today people couldn't make it 12 hours if all the money became worthless. No doubt MAYHEM would break out in a hurry.
