Posted on 08/02/2016 1:48:55 PM PDT by MichCapCon
The Federal Reserve can never raise interest rates again. I simply can not see how they can do it, without bankrupting the US Government, or most of Europe and Japan.
To those of you who say the Federal Reserve or other central banks don’t control long-term rates - my answer is “nonsense.” QE, Operation Twist, buying GSE debt, Helicoptor Money - all have been, or can be used, to drive rates all along the yield curve. The Fed is an (unconstitutional) soviet style economic planning bureau that will basically destroy our economy, just as the soviets destroyed theirs.
Since just a few BANKS own the FED, I suggest THEY pay it off out of profits for the next 100 years.....??? LOL...
The Federal Reserve can never raise interest rates again. I simply can not see how they can do it, without bankrupting the US Government, or most of Europe and Japan.
“The Federal Reserve can never raise interest rates again.”
Don’t think folks realize that fact....ORFs are doomed to find some place else for their savings..and that means ‘rolling the dice !’
A 20% across the board import tariff balances the budget and strengthens the US domestic economy. THIS HAS TO BE DONE. THERE IS NO OTHER WAY. Pay now or collapse later.Accept a little inflation now or economic death tomorrow.
I was just scolded last week by a young PhD economist in our gov’t security meeting, the following Paul Krugman brainwash toxin:
“We are in a new economic paradigm where national debt, money suppy, the velocity of money, and zero / negative interests no longer matter because our economy is based on innovative productivity.”
I hope someone rubs his manchild nose hard in the pavement when we All Fall Down...
There was virtually NO mention of the debt (that I heard) at either convention, especially at the Democratic convention. Instead, all the talk was about much more free stuff. In fact, inviting the rest of the World in to partake of our free stuff. The total disconnect from reality is just stunning. This is exactly how Venezuela got in the trouble its in right now.
If interest rates were at a sensible rate that gave a sensible return to savers, say 5%, then the interest on the debt expense annually would be $1,000,000,000,000, or 20% to 25% of the federal budget.
Huh? . Wait, I though Obama said the sun was shining, birds are singing and all is rainbows and unicorns? This article is too dark,
Nobody running for office is very interested in addressing the debt. Party at the end of the world, everyone!
When they can no longer find enough people to willingly buy bonds at those artificially low rates, they will have to print money.
Oh wait, they already are - the Fed is now a huge “buyer” of Treasury debt, with money that they simply make themselves.
When that becomes prohibitive, they will have to force people to buy their debt.
Oh wait, they already do. They have increased the amount of Treasury debt that banks must hold, to be considered “solvent” by the Government regulators. Technically, they refer to that as financial repression (not a joke).
Then they will have to repay debt holders with IOUs. Already do, for a large percentage.
Then they will have to take more from citizens. Ditto.
Finally they will have to stop paying the bills. Party over.
A 20% import tariff would stop the bleeding and borrowing.
Even a single percentage point raise would pretty much double the amount of interest that would have to be paid yearly.
“A 20% import tariff would stop the bleeding and borrowing.”
I am afraid not.
Without spending restraint, no income is sufficient. The largest tax increase in human history was enacted under Obama (more than tariffs produce) - it was all spent, and more.
The purpose of negative interest rates is to discourage savings. It’s to force people to cash out their paycheques completely everytime they get paid.
20 trillion? What drugs have you been taking? Unfunded obligations are closer to 120 trillion.
All those baby boomer pensions and all that unearned SSDI funding? Medicaid?
We are going to default on those obligations or we are going to crash.
20% is at current spending levels. Tariffs can be increased easily.
Or trigger a world wide depression. Possibly a world war.
This economic stuff is not easily predictable. It often does weird counter-intuitive things.
The one thing I know we need to do is stop letting non-taxpayers vote. Then we need to reign in the spending party in Washington D.C.
But none of that is going to happen. We are going to crash.
“We are in a new economic paradigm where national debt, money suppy, the velocity of money, and zero / negative interests no longer matter because our economy is based on innovative productivity.”
In 1999, I’ll bet he was championing “end of the business cycle as we know it” nonsense and dismissed all reports of the .com implosion that started in 2000 as right wing rhetoric that destroyed the “Clinton/Rubin” economy.
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