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JUST WANTED TO POST MY BLOG HERE AND GET SOME REACTION:
Macroeconomics is complex,and you probably don’t want to know any more about it than you have to. But, please, the information that follows is critically important to you if you care at all about America’s fiscal future. I want to analyze the treasonous steps taken overnight by Ben Bernanke and his band of Fed thieves, but I want to simplify this complex issue as much as possible. That’s my way of saying that
this won’t answer every conceivable question that you might have about monetary policy, but to do that one would need to earn a college degree in ME and none of us are likely to do so.
At around 7:15 this morning, it was announced that a coordinated action plan between the Central Bank of Europe (CBOE), the Central Bank of Canada (CBOC), and the US Federal Reserve (FED) would be entered into whereby these “banks” would be lending the commercial banks throughout Europe, US dollars to keep the banks afloat (BAILOUT)! Here are the bullet points that describe the BAILOUT:
1. Why the BAILOUT needed? Euro banks (and most of the largest American banks) have invested hugely (number in the hundreds of billions) in sovereign debt of the socialist Euro nations (Greece, Italy, Spain, Ireland, etc.). These nations’ leaders, like the US, refuse to slash government spending, and as a result, cannot repay the banks to retire the sovereign debt. Without that repayment, virtually all of the Euro commercial banks will GO OUT OF BUSINESS!
2. So let ‘em. What do we care that Europe is so broke they can’t survive? Bernanke and the rest of the elite intelligencia are worried that if that happens, American businesses will suffer since nobody in Europe will be able to afford to buy any US exports, nor will they be capable of producing any of the goods we currently import from Europe.
3. Where are our US dollars being sent to and why? These “new” (important distinction) US dollars will be loaned to Euro commercial banks who, in theory, would loan out those dollars to the private sector to keep Europe “running”. THE FACT IS THAT THE EURO BANKS ALREADY HAVE HOARDS OF CASH, BUT THEY ARE NOT LOANING IT. Why not? They realize that so much of their own (the banks’) wealth is tied up in worthless Euro debt, that they are hoarding all the cash they can get their hands on…sort of as a “reserve” after the whole Euro economy tanks. BTW, without the liquidity injection, most experts believe the Euro (specific European Community currency) and the EU would have imploded within the next seven days (remember Confederate currency? What’s it good for today?).
Every respected economist in America is certain that this BAILOUT is only temporary, and, despite anything that the US (or anyone else) does, the Euro and the EU are beyond saving. Both will no doubt be in the same situation by May 2012 when our open credit line to Europe closes. This step is 100% nothing more that delaying the inevitable…though at a huge financial cost to the US taxpayers. Everybody knows this, so why? I suggest that one needs look no further than George Soros (who has personally collapsed four world currencies prior to now) and the Obama Administration. From my previous writings, you should understand what “their game is”. COLLAPSE AMERICA!
So, where is the money that the US is providing coming from? This is the most important point that a reader should take from this. Maybe we will just take the money out of the Treasury and send it to CBOE. No wait. Remember, the US government BORROWS 40 cents of every dollar it spends so, the fact is, there is NO MONEY SITTING IN THE TREASURY! There are two ways in which we can raise the money to give it to Europe:
1. We can borrow the money through the issuance of new national debt (a great deal of which would come from China). Currently the US is paying around 2.1% interest on ten year Treasuries. The dollars we are BAILING EUROPE OUT with are being loaned to them at a rate of .71% interest. What? We might borrow money at 2.1% and then loan the same money out at .71%. Are you nuts? No, I’m not, but perhaps Ben Bernanke and his DC thugs are, or,
2. Uncle Ben can call the mint and tell them to print up another half a trillion in new bills. This is the course that he will choose. So, what’s the problem with that? SEE MY AUGUST POST REGARDING THE DESTRUCTION OF THE DOLLAR AND INFLATION. It’s an irrefutable fact that when you increase a money supply dramatically and there is no corresponding increase in economic output, the dollar weakens and it takes more dollars to buy the same goods and services. INFLATION! The financial community understands this clearly, but, apparently not the eggheads in DC. This is not my own unproven theory and here is proof of it. At 7:15 this morning world oil was trading at $98.75 per barrel…the announcement of the BAILOUT was made at 7:20…at 7:25, the spot oil price was $101.35 per barrel! Did oil suddenly become more scarce? No, knowledge was out that we, the US, will be flooding the world with new dollars. Ditto on gold prices…. $1,719 per ounce at 7:15 and $1,742 per ounce at 7:25!
I fear I’ve gotten a bit too deep “in the weeds”, but the takeaway from all of this is that we, the broke US, are BAILING OUT Europe and inflation is now inevitable. It is not a matter of if, but when, we will see major (if not hyper) inflation here at home. My opinion is that it will take until probably the second quarter of 2012 to see the spikes work their way through the production cycle to the retail level, but
I suggest we will likely see DOUBLE DIGIT annual inflation through 2012.
In closing, I ask you, and suggest that you ask your Congressperson and Senators, when is ENOUGH? This is lunacy and either this kind of nonsensical policy will cease immediately…or America will in the very near future.
Macroeconomics is complex,and you probably don’t want to know any more about it than you have to. But, please, the information that follows is critically important to you if you care at all about America’s fiscal future. I want to analyze the treasonous steps taken overnight by Ben Bernanke and his band of Fed thieves, but I want to simplify this complex issue as much as possible. That’s my way of saying that
this won’t answer every conceivable question that you might have about monetary policy, but to do that one would need to earn a college degree in ME and none of us are likely to do so.
At around 7:15 this morning, it was announced that a coordinated action plan between the Central Bank of Europe (CBOE), the Central Bank of Canada (CBOC), and the US Federal Reserve (FED) would be entered into whereby these “banks” would be lending the commercial banks throughout Europe, US dollars to keep the banks afloat (BAILOUT)! Here are the bullet points that describe the BAILOUT:
1. Why the BAILOUT needed? Euro banks (and most of the largest American banks) have invested hugely (number in the hundreds of billions) in sovereign debt of the socialist Euro nations (Greece, Italy, Spain, Ireland, etc.). These nations’ leaders, like the US, refuse to slash government spending, and as a result, cannot repay the banks to retire the sovereign debt. Without that repayment, virtually all of the Euro commercial banks will GO OUT OF BUSINESS!
2. So let ‘em. What do we care that Europe is so broke they can’t survive? Bernanke and the rest of the elite intelligencia are worried that if that happens, American businesses will suffer since nobody in Europe will be able to afford to buy any US exports, nor will they be capable of producing any of the goods we currently import from Europe.
3. Where are our US dollars being sent to and why? These “new” (important distinction) US dollars will be loaned to Euro commercial banks who, in theory, would loan out those dollars to the private sector to keep Europe “running”. THE FACT IS THAT THE EURO BANKS ALREADY HAVE HOARDS OF CASH, BUT THEY ARE NOT LOANING IT. Why not? They realize that so much of their own (the banks’) wealth is tied up in worthless Euro debt, that they are hoarding all the cash they can get their hands on…sort of as a “reserve” after the whole Euro economy tanks. BTW, without the liquidity injection, most experts believe the Euro (specific European Community currency) and the EU would have imploded within the next seven days (remember Confederate currency? What’s it good for today?).
Every respected economist in America is certain that this BAILOUT is only temporary, and, despite anything that the US (or anyone else) does, the Euro and the EU are beyond saving. Both will no doubt be in the same situation by May 2012 when our open credit line to Europe closes. This step is 100% nothing more that delaying the inevitable…though at a huge financial cost to the US taxpayers. Everybody knows this, so why? I suggest that one needs look no further than George Soros (who has personally collapsed four world currencies prior to now) and the Obama Administration. From my previous writings, you should understand what “their game is”. COLLAPSE AMERICA!
So, where is the money that the US is providing coming from? This is the most important point that a reader should take from this. Maybe we will just take the money out of the Treasury and send it to CBOE. No wait. Remember, the US government BORROWS 40 cents of every dollar it spends so, the fact is, there is NO MONEY SITTING IN THE TREASURY! There are two ways in which we can raise the money to give it to Europe:
1. We can borrow the money through the issuance of new national debt (a great deal of which would come from China). Currently the US is paying around 2.1% interest on ten year Treasuries. The dollars we are BAILING EUROPE OUT with are being loaned to them at a rate of .71% interest. What? We might borrow money at 2.1% and then loan the same money out at .71%. Are you nuts? No, I’m not, but perhaps Ben Bernanke and his DC thugs are, or,
2. Uncle Ben can call the mint and tell them to print up another half a trillion in new bills. This is the course that he will choose. So, what’s the problem with that? SEE MY AUGUST POST REGARDING THE DESTRUCTION OF THE DOLLAR AND INFLATION. It’s an irrefutable fact that when you increase a money supply dramatically and there is no corresponding increase in economic output, the dollar weakens and it takes more dollars to buy the same goods and services. INFLATION! The financial community understands this clearly, but, apparently not the eggheads in DC. This is not my own unproven theory and here is proof of it. At 7:15 this morning world oil was trading at $98.75 per barrel…the announcement of the BAILOUT was made at 7:20…at 7:25, the spot oil price was $101.35 per barrel! Did oil suddenly become more scarce? No, knowledge was out that we, the US, will be flooding the world with new dollars. Ditto on gold prices…. $1,719 per ounce at 7:15 and $1,742 per ounce at 7:25!
I fear I’ve gotten a bit too deep “in the weeds”, but the takeaway from all of this is that we, the broke US, are BAILING OUT Europe and inflation is now inevitable. It is not a matter of if, but when, we will see major (if not hyper) inflation here at home. My opinion is that it will take until probably the second quarter of 2012 to see the spikes work their way through the production cycle to the retail level, but
I suggest we will likely see DOUBLE DIGIT annual inflation through 2012.
In closing, I ask you, and suggest that you ask your Congressperson and Senators, when is ENOUGH? This is lunacy and either this kind of nonsensical policy will cease immediately…or America will in the very near future.
Higher the debt goes up the more profit they make. No wonder they are so willing to help
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