Posts Tagged ‘Fed’
Dollar Crisis…
Image via Wikipedia
As a major currency crisis looms in the west, there are some things that we should all expect. Lifestyle changes that we don’t have to imagine, but ones we can see happening right in front of us today. Now the catalyst for the beginning of a major currency crisis could be several things. To note just a few, QE2 ending would cause a spike in interest rates, banking crisis, and inevitably a debt crisis that would lead to a dollar crisis. Unfortunately for those living in America, the extension of more QE, a QE3 will only delay the inevitable and actually make things much worse in the end. QE3 will signal to the world that there is no hope for the U.S. to ever manage its debt crisis, an admission that our economy is propped up by fiat magic money, and global price inflation will occur as a result of an increase in the global reserve currency.
Elitists Leading On An Odyssey Of Economic Ruin…
- Image via Wikipedia
All the kings horses and all the kings men couldn’t put Humpty back together again…~jude
Bob Chapman
The price of commodities, particularly food and petroleum products, will be higher in the coming year, which will strain budgets more than ever for those who still have jobs. Unemployment will not get appreciably better and government debt will rise. Government is talking about raising the Social Security retirement age by three years, freezing payments and offering government guaranteed annuities in exchange for those of you that do have retirement plans. Two-thirds of those in and about to retire have only Social Security for 50% of their income. The money collected since 1935 is all gone, having been spent by past politicians. In fact, if you put all present and future commitments together you have a debt of $105 trillion.
The Beginning of the End of the American Empire Excerpt from “The Global Economic Crisis”…
“I sincerely believe… that banking establishments are more dangerous than standing armies.”–U.S. President Thomas Jefferson; Letter to John Taylor, May 1816
America is dying. It is self-destructing and bringing the rest of the world down with it.Often referred to as a sub-prime mortgage collapse, this obfuscates the real reason. By associating tangible useless failed mortgages, at least something ‘real’ can be blamed for the carnage. The banking industry renamed insurance betting guarantees as “credit default swaps” and risky gambling wagers were called “derivatives”. Financial managers and banking executives were selling the ultimate con to the entire world, akin to the snake-oil salesmen from the 18th century but this time in suits and ties. And by October 2008, it was a quadrillion-dollar (that’s 1 000 trillion dollar) industry that few could understand.[1] Propped up by false hope, America is now falling like a house of cards.
The Beginning of the End
It all began in the early part of the 20th century. In 1907, J.P. Morgan, a private New York banker, published a rumor that a competing unnamed large bank was about to fail. It was a false charge but customers nonetheless raced to their banks to withdraw their money, in case it was their bank. As they pulled out their funds, the banks lost their cash deposits and were forced to call in their loans. People therefore had to pay back their mortgages to fill the banks with income, going bankrupt in the process. The 1907 panic resulted in a crash that prompted the creation of the Federal Reserve, a private banking cartel with the veneer of an independent government organization. Effectively, it was a coup by elite bankers in order to control the industry.
The con of the century – Federal Reserve made $9 trillion in short-term loans to only 18 financial institutions. Since 2000 the US dollar has fallen by 33 percent. The hidden cost of the bailouts…
- Image by Getty Images via @daylife
Posted by mybudget360
The Federal Reserve released a stunning report showing the details of bailouts that occurred during the peak of the credit crisis. They won’t call it “bailouts” but giving money when others won’t is exactly that. What the report shows is that the Fed operated as a global pawnshop taking in practically anything the banks had for collateral. What is even more disturbing is that the Federal Reserve did not enact any punitive charges to these borrowers so you had banks like Goldman Sachs utilizing the crisis to siphon off cheap collateral. The Fed is quick to point out that “taxpayers were fully protected” but mention little of the destruction they have caused to the US dollar. This is a hidden cost to Americans and it also didn’t help that they were the fuel that set off the biggest global housing bubble ever witnessed by humanity. A total of $9 trillion in short-term loans were made to 18 financial institutions. Still think the banking bailout didn’t happen or cost us nothing? Let us first look at the explosion of assets on the Fed balance sheet.
The Fed is still carrying longer term debt on its books that shouldn’t be there:
Bernie Sanders: ‘Will You Tell The American People Which Banks Got $2.2 Trillion Of Their Dollars?’ Bernanke: ‘No’ »…
Great Exchange! Senator Bernie Sanders can’t contain himself during today’s (03/03/09) Senate Budget Commitee hearing in Washington. Bad Boy Bernie demands to know who got the 2.2 trillion of dollars in loans from the Fed. Bernanke won’t tell him. He’s also angry that banks that get tax payer funds for nothing, are charging credit card customers 25% interest. Also discusses A.I.G. and who got those credit Defautl swaps. He also demands to know why Bernanke didn’t raise the alarm when the Bush Administration was claiming the economy was sound when it obviously wasn’t.
Video – Sen. Bernie Sanders scolds Helicopter Ben
At the Bail, we hang Federal Reserve criminals with their words.
Funding Crisis Defined…
- Image by f650biker via Flickr
Thanks to everyone for taking the time to send in your entry for this contest.
from Bill Fleckenstein, May 2009
Now I’d like to make a comment about the funding crisis—the third in the three-baseball-game analogy that I dreamed up last fall as a way to be able to think through all the enormous problems we faced. The first and second games (crises)—financial and economic, respectively—were pretty easy for folks to understand, as they were front and center to the news.
Essentially, the financial crisis now lies behind us (with the economic crisis in full bloom, the recent economic “bounce” notwithstanding). That, due to all the moves put together by Hank Paulson and other government officials—which, as those actions stopped the vaporization of the financial system — essentially gave everyone a do-over. But therein lay the seeds for the funding crisis, if the dollar is called into question (as now appears to have begun) and if the Fed’s monetization cannot lower rates (and in fact causes them to rise, due to the consequences of money printing), then the Fed is trapped. The more it tries to solve the problem with money printing, the worse it all becomes.
The best reader definitions…..
Winner:
A funding crisis happens to a country when other nations or institutions believe that the value of its sovereign debt or the value of its currency will decline significantly over time due to poor fiscal or monetary policies.
When that happens, fewer and fewer people are willing to purchase the sovereign debt of that country, leading to a sharp increase in interest rates and greatly increased difficulty in the ability of that country to raise new debt.
A funding crisis thus refers to the inability of a country to finance itself without resorting to outright money printing. This can lead to a vicious cycle of currency depreciation, rising interest rates, poor economic performance and poor investor sentiment, all of which feed on each other in a downward spiral.
A funding crisis can only end when proper monetary and fiscal discipline is restored, usually at the expense of severe economic hardship.
This one earned a tie as it was almost as good AND he used the search so well
In gentle criticism to the Rap Reader who inspired this little exercise, it may be useful and prudent to read a majority of those “so many references” pertaining to the “Funding Crisis”. I searched “Funding Crisis” and read everything that had a score of over 25. In this review, I discovered you started describing the “Funding Crisis” in the middle of 2006, but you did not give it a ‘handle’ until late 2008. I am glad I participated in this exercise as I learned a great deal and have a more clear financial picture of where we have been, where we currently are and where we may be going.
A Funding Crisis: the successor to the financial and economic crises; created mainly as a result of Federal Reserve policy over the last twenty years. A funding crisis occurs due to a lack of credibility in the Federal Reserve (and, the United States) to instill confidence in the value of the US dollar and repayment of current and future liabilities. The result of a US funding crisis is: a declining value of the US dollar and rising interest rates in debt markets.
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