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Old 01-09-2019, 08:04 AM   #1
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Our monetary system is insane

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For years critics of U.S. central-bank policy have been dismissed as Negative Nellies, but the ugly truth is staring us in the face: Stock-market advances remain a game of artificial liquidity and central-bank jawboning, not organic growth. And now the jig is up.
...
What’s the larger message here? Free-market price discovery would require a full accounting of market bubbles and the realities of structural problems, which remain unresolved. Central banks exist to prevent the consequences of excess to come to fruition and give license to politicians to avoid addressing structural problems. And by preventing these market forces from playing out at each sign of trouble, the can gets kicked further and further down the road. Each successive recovery keeps the illusion alive, but “accommodation” requires ever-lower rates before the monsters return. In the meantime, debt keeps expanding, while each recovery produces less and less organically driven growth, and ever-higher wealth inequality. This is what this system produces.
...
https://www.marketwatch.com/story/st...uth-2019-01-05
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Old 01-16-2019, 11:05 AM   #2
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Between this and the saga of The Narrow Bank, I can only shake my head...

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...
The Fed earns interest income on the huge pile of securities it holds. After covering operating expenses, interest expenses, and some other items, it is required to remit the rest to the Treasury Department – to the taxpayer.

Therefore, the amounts in interest expense the Fed pays the banks on their “Excess Reserves” and “Required Reserves” comes out of the taxpayer’s pocket and its transferred to the banks to become bank profits, and thereby bank executive bonuses and stock holder dividends, funded by the dear taxpayers. And this amount was huge in 2018: $38.5 billion!

Here is what the Fed reported: ...
More: https://wolfstreet.com/2019/01/10/fe...yers-to-banks/
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Old 01-22-2019, 06:58 AM   #3
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Originally Posted by Ron Paul :
President Trump’s frustration with the Federal Reserve’s (minuscule) interest rate increases that he blames for the downturn in the stock market has reportedly led him to inquire if he has the authority to remove Fed Chairman Jerome Powell. Chairman Powell has stated that he would not comply with a presidential request for his resignation, meaning President Trump would have to fire Powell if Trump was serious about removing him.

The law creating the Federal Reserve gives the president power to remove members of the Federal Reserve Board — including the chairman — “for cause.” The law is silent on what does, and does not, constitute a justifiable cause for removal. So, President Trump may be able to fire Powell for not tailoring monetary policy to the president’s liking.

By firing Powell, President Trump would once and for all dispel the myth that the Federal Reserve is free from political interference. All modern presidents have tried to influence the Federal Reserve’s policies. Is Trump’s threatening to fire Powell worse than President Lyndon Johnson shoving a Fed chairman against a wall after the Federal Reserve increased interest rates? Or worse than President Carter “promoting” an uncooperative Fed chairman to Treasury secretary?

Yet, until President Trump began attacking the Fed on Twitter, the only individuals expressing concerns about political interference with the Federal Reserve in recent years were those claiming the Audit the Fed bill politicizes monetary policy. The truth is that the audit bill, which was recently reintroduced in the House of Representatives by Rep. Thomas Massie (R-KY) and will soon be reintroduced in the Senate by Sen. Rand Paul (R-KY), does not in any way expand Congress’ authority over the Fed. The bill simply authorizes the General Accountability Office to perform a full audit of the Fed’s conduct of monetary policy, including the Fed’s dealings with Wall Street and foreign central banks and governments.

Many Audit he Fed supporters have no desire to give Congress or the president authority over any aspect of monetary policy, including the ability to set interest rates. Interest rates are the price of money. Like all prices, interest rates should be set by the market, not by central planners. It is amazing that even many economists who generally support free markets and oppose central planning support allowing a government-created central bank to influence something as fundamental as the price of money.

Those who claim that auditing the Fed will jeopardize the economy are implicitly saying that the current system is flawed. After all, how stable can a system be if it is threatened by transparency?

Auditing the Fed is supported by nearly 75 percent of Americans. In Congress, the bill has been supported not just by conservatives and libertarians, but by progressives in Congress like Dennis Kucinich, Bernie Sanders, and Peter DeFazio. President Trump championed auditing the Federal Reserve during his 2016 campaign. But, despite his recent criticism of the Fed, he has not promoted the legislation since his election.

As the US economy falls into another Federal Reserve-caused economic downturn, support for auditing the Fed will grow among Americans of all political ideologies. Congress and the president can and must come together to tear down the wall of secrecy around the central bank. Auditing the Fed is the first step in changing the monetary policy that has created a debt-and-bubble-based economy; facilitated the rise of the welfare-warfare state; and burdened Americans with a hidden, constantly increasing, and regressive inflation tax.
http://www.ronpaulinstitute.org/arch.../fire-the-fed/
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Old 01-22-2019, 10:46 AM   #4
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Pretty succinct summary:
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...
Since the global financial crisis, the business cycle has been suspended, and replaced by only a credit cycle. Credit, credit and more credit crowded out productivity and inflated asset prices while doing little for the real economy and driving the worst inequality in generations. The mis-pricing of money and credit has also driven a terrible misallocation of capital and kept unproductive zombie debtors alive for too long.
...
https://www.home.saxo/-/media/docume...eport-2019.pdf
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Old 01-22-2019, 02:47 PM   #5
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Watching the insane vacillations in the market recently, I am nervously reminded of 2008, early 2009. When this mother blows up again, and it will, there simply isn't enough money to print our way out of the ball of flames this time around. There will be blood in the streets all over the world. The US will not be able to sell another bond for a very long time indeed.

We will take a host of other nations out with us as well, because the giant vampire squids that are our banking system are incestuously intertwined with the rest of the insanely over indebted banks around the world. They all think that by selling each other CDS that they have their collective asses covered, but they are just fooling themselves. If an idiot layman like myself can see right through the farce, then surely the regulators already know.

The columns of smoke will be visible for miles. The ultimate death toll......unimaginable.
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Old 01-23-2019, 01:12 PM   #6
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printing isnt the problem now its pretty much all just computer code, its a loss of confidence in a currency and it no longer being the choice of people.

Because we ( mostly) have no choice, the game can continue indefinately.

Johnny foreigner and other countries can exercise a bit more choice but because the central banks are in cahoots its not really much of a choice.

The entire world has to have reason to stop using fiat.
Even if we can all see the fraud perpetrated by banks and gov we are obliged ( by force if necessary) to continue using fiat.
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Old 01-24-2019, 02:28 PM   #7
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Henry Ford said ~ It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.

Debt is the biggest problem. When the banks fail again (like Deutsche bank is right now) the government can't bail them out again, because that would collapse the currency.

https://libertyleak.com/2019/01/22/w...od-investment/
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Old 02-19-2019, 09:37 AM   #8
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Harvard’s recent two-day conference, “Money as a Democratic Medium,” challenged its participants to re-examine the history of money in America, and to redefine its future. The event was jointly sponsored by the Harvard Program on the Study of Capitalism, the Murphy Institute at Tulane University, the Harvard Law Forum and Harvard Law School, bringing a diverse group of lawyers, economists, academics and scholars to the HLS campus.
...
Gerald Epstein, of the University of Massachusetts—Amherst, said that the rise of finance coincided with that of inequality, creating a system that favors some citizens over others. “Underlying all of this is a process by which wealth generates political power, to further this wealth and equality.” The country, he said, is now run by a “bankers’ club” that includes elected officials who get campaign contributions from banks, central banks that make decisions on whom to bail out, and regulatory authorities and lawyers “who do the bidding of these elites to try and rewrite rules.” ...
More: https://today.law.harvard.edu/money-...cratic-medium/

Some absurd stuff in there, but what really hit me as I read this was the fact that the conference happened at all and who was participating. Just based upon the folks mentioned, it seems to have been a mix of the Davos/G20 crowd with folks one or two degrees removed from it.
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