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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: zzpat who wrote (1035828)	10/31/2017 9:12:54 PM
From: RetiredNow	1 Recommendation Recommended By Taro Read Replies (1) \| Respond to of 1573868

You have it mostly right, except the part where you say QE wasn't real money. Actually, it was and is. The transmission mechanism is that the Fed transferred trillions to banks at zero percent interest. Those banks purchased trillions in treasuries, MBS, and other bonds. The delta in interest those banks earned on those bonds and the zero interest the Fed charged was and continues to be a tax on the American people. It was a transfer from savers to borrowers. Those banks newly flush with cash and with earnings on invested funds that were essentially stolen from the citizens was then used to make other investments that earned the banks more money, which did flow back into the economy. The trillions in QE, though remain parked in those bonds, which is why we didn't get the multiplier effect, nor inflation. However, it is real money and the banks were recapitalized. The thing everyone seems to miss, though, is that all of that money the banks were recapitalized with never belonged to the Fed nor those banks. It is no different than if they had taxed our citizens to recapitalize those banks. They just did it in a very sneaky way that only 1 man in a million can diagnose, to quote Keynes. In addition, it has accelerated the divide between the rich and poor. Why do you think the middle class is rapidly disappearing? The monetary policy of the Fed, combined with the moral hazard of bailing out criminal bankers who created the financial crisis has absolutely destroyed the middle class and enriched the rich. It's actually pretty sad that the American people don't understand exactly what has happened. I can tell the citizens understand that something is wrong, which is why got Bernie and Trump, but the citizens haven't really diagnosed specifically what is wrong. We have moral hazard running absolutely amok in this country. Crony capitalism and corruption is now systemic. We have a lot of problems and the Fed is one of the biggest problems. Get rid of the Fed and we can begin to heal. However, I don't have hope that will happen. We are on a downward spiral now and only a miracle will allow us to reverse course. But even a miracle can't happen with the level of ignorance and lack of proper education in this country.