To: Don Hurst who wrote (10745 ) 8/10/2002 12:21:06 PM From: Crystal ball Read Replies (1) | Respond to Brazilian Proof: What Greenspam did and Why: The Federal Reserve as the US Central Bank, throug the World Bank and IMF MONETARY POLICY failed in its oversight of bad loans made to corrupt Asian Banks during the 90's going into the Asian Contagion and Japanese and other Asian Bank defaults and failures, the so called Asian Flu of 1999. To cover and make up for these bad loans, the FED like other central banks had to come up with cash, but in the roaring stock market, no one was buying US Bonds, Treasury Bills and Treasury Notes, Federal Reserve paper was worthless. Thus jacking up the FOMC interest rates, bidding up the return on Government paper to compete with private corporate paper, stock and equities. The market crashed, there has been a race into Bonds and Government paper ever since, particularly in 2000 and 2001. Here we now sit in 2002 with low FED rates, the lowest FOMC rates since the 1950's. Even Government paper is now worthless, safe, but worthless in any INFLATIONARY cycle, not only that, but the Federal Reserve and other IMF central banks are now drowning in money supply. This spells inflation. An Oversupply of Money, in all the forms of the money supply, M1, M2, even M3, means, together with the falling value of the dollar, that the dollar, has less and less value, and in an inflationary environment, even less value for government paper that pays a low rate of return due to the low interest rate that Greenspan is stuck with, that will not be able to keep up with any form of inflation or rise in the CPI or other price inflation metrics. What to do? As we have seen, this week, the IMF is giving Brazil more money for its bail out and refinancing than Brazil wants or needs. Dump the money. Put the money where history shows it will be consumed, and thus lower the money supply, and prevent the inflation that threatens the whole world economy just around the corner. 35 Billion Dollars to Brazil, that is proof of what and why Greenspan did. Truth in Government and Accountability, no, ust the opposite, since the Federal Reserve and Federal Open Market Committee and other IMF World Bankers will never admit they were wrong, ARE WRONG NOW, and have a failed CENTRAL CONTROL model for managing the economy that the fall of the Soviet Union proved is a failed economic system in ANY form. It may be time to let all the little old ladies and Mom and Pops who lost their life savings in the Stock crash and current lack of confidence in the equity markets know that it was Greenspan and the Federal Reserve that basically set them up for the fall, and in effect took their money right out of their hands to COVER UP their failings. Didn't WorldCom executives go to jail in handcuffs for cooking the books to the tune of $6 Billion, why not the real culprits? Time to change the Federal Reserve, put it under the US Treasury where it belongs so that it is at least accountable to Congress and the President, and promote decentralization, if you want to prevent America from becoming just another free trade zone where our children and grandchildren will only be paid slave labor wages like the 9 cents an hour in Communist China.
