“Robbery in Progress at 33 Liberty Street!”
…Said no policeman ever.
“In globalist Amerika, banks rob you!” – old Russian joke (and true).
So, early last week, interesting news broke that the New York Federal Reserve Bank was deploying a little cash in order to maintain interest rates. When one eases quantitatively, the quantities are relative. It turns out “a little” equals about (or, easily could equal about) $2,300,000,000,000 (two trillion, three-hundred billion dollars). Chump change, right? Back to the climate hoaxes and football rape telethons!
But, this is serious. On Monday, September the 16th, the NY Fed started pumping $75 Billion per day into the commercial banks. This will continue through and until October 10th. That’s $1.875 Trillion right there. As a bonus, the crooks, er, the Fed will also spring $420 Billion in REPO BUCKS!!! (like a lottery game or something)(14 days X $30 Billion per day) in an attempt to gift yet more free fake money to the constituent ownership of the Fed. If this seems to you a tad self-serving, then you’re on to something.
All of this is happening during what we are assured are the very best of economic times. And, again, it’s all taking place in a span of less than a month. !Poof! Just like that the banksters have another $2.3 Trillion to play with, waste, or hoard. Temporally – and this is really fun stuff – $2.3 Trillion was the value of the entire economy as recently as 1950. In other words, what took previous generations 174 years to accumulate, the Fed just summons up out of the Dark Crystal instantly. This is why I now refer to what passes as practical economics as “sorcery.” There’s no other label that fits.
What’s the deal with the rates? The Fed, in acts of utter desperation to forestall a depression or worse, is lower borrowing rates towards zero. Then, they’ll go negative. How far into negative territory doesn’t really matter. Interest rates are the cost, the price of borrowing money – how much the money is itself worth as a stand-alone item. Negative rates indicate a situation worse than worthlessness, of positively detrimental values. The total fulfillment (and beyond) of Gresham’s Law.
The news suggests how bad things are. If the Fed adjusts rates downwards, but then has to bribe the banks to take the cheaper money, then that means the effective rates are already even lower and falling. It’s like robbing Peter, so they can afford to rob Paul. Literally anyone else would be in jail. Ask Bernie Madoff. Excuses aplenty will be quietly provided. The dog ate my liquidity, Mrs. Wall Street! You may safely believe whichever of them you like. Just know that all of it is a sham.
THE WHOLE CRASS MESSAGE AT TPC!