OK, Ted. Once again, pay attention. I'm going to give you a short master class in real economics, not the ivory tower bullshit that you've been fed by the morons who run the propaganda in this country that keep unthinking people tame.
We don't need the Federal Government repairing roads and bridges. Where I live, we have a strong local and state economy, and guess what? We have good roads, bridges, and infrastructure. So that whole infrastructure is crumbling because we don't tax the rich enough is just one giant lie spread by the Keynesians and Democrats. The reality is that Keynesians are 3rd graders when it comes to the economy. Let's talk about Quantitative Easing, this brilliant idea by Keynesians that we can bring prosperity to the US through money printing to buy up Treasuries and MBS bonds. Even the Fed itself now has studied QE and decided that it didn't work. To whit:
St. Louis Fed official: No evidence QE boosted economy
cnbc.com
So once you've read the above, then think on this. All QE really did was soak $4.5 trillion of collateral, which squeezed yields on bonds to the point where there is now very little money to be made in bonds, even on the long end. That in turn forced everyone into higher yielding and higher return stocks, which inflated asset prices across the board. QE coupled with ZIRP inflated real estate and rents to the point where budgets of the 99% are being killed by the triple burden of high rents, high health care costs, and higher food costs. So QE begat asset and price inflation. Once that ended, the jaw boning of the Fed, combined with the shale oil revolution and the Saudi oil pumping fest to kill the shale oil revolution has tanked oil prices, which has conspired to send the dollar soaring and effectively killed the petrodollar. Then China imploded, followed by pretty much all the BRICs and emerging and developing countries, which sent their stock markets and commodity prices cratering. Although a strong dollar and low commodity prices are good for the US consumer, creating a countervailing deflationary global environment, the net of all that created massive outflows of hard currency from emerging and developing countries as investors sold anything not locked down. Then those countries started selling US Treasuries by the boatload to defend their currencies against the US dollar, so that their exports wouldn't tank. That didn't work so well, so China decided to devalue the Yuan a bit, which created even more problems for their stock market. Other measures like selling US Treasuries to buy up Chinese stock shares didn't do any good, as we all knew it wouldn't.
So what did all this global selling of US Treasuries do to the US? Well, if QE is soaking up US Treasury collateral through printing of money and bond buying, then the whole world selling off their US Treasury stockpiles is Quantitative Tightening, which sends the dollar higher, puts a crimp in US exports, damaging prospects for US multinational company profits, which sends our own stock market tanking, because stock markets are always pricing out information forecasts on future company earnings. Lower US stock markets, where most everyone is invested now, because bonds aren't yielding anything, means the mom and pops and pension funds of the country just took a massive hit, which means we now have a reverse wealth effect.
Oops. Consequences have arrived. QED. Quantitative Easing begets asset price inflation, which begets currency wars and financial instability, which begets Quantitative Tightening, which means we're all riding a roller coaster based on nothing more than the flapping of the butterfly wings of central banks around the world.
When in hell will people learn once and for all that prosperity comes from hard work, from the free exchange of goods and services between people, priced based on supply and demand...in short, prosperity comes from Capitalism...and that central banks only do one thing...create roller coasters and poverty for everyone except other banks, which is who they really work for.
END THE FED. That's the only sensible course of action when it comes to this monstrous unelected 4th branch of government. Today's evil doers are none other than the central banks and the criminal banksters. They are the source of all of this mess and they will continue to be the source of all this mess until the sheeple citizens wise up. Check in with Elizabeth Warren and Ron Paul. They know all this. |
