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The Truth About the Fedís Relationship With Bubbles
Zero Hedge / Phoenix Capital Research ^ | 28 July 2014 | Phoenix Capital Research

Posted on 07/29/2014 6:37:14 PM PDT by Lorianne

Many commentators have previously argued that the Fed is too dumb or too inept to identify of categorize asset bubbles.

By focusing on the Fed’s mental acuity, these commentators are overlooking a key factor: the Fed WANTS to asset bubbles.

The reason for this?

Asset bubbles, at least according to the Fed’s models, will paper over the steady decline in quality of life that began in the US roughly 50 years ago.

This fact is staring everyone in the face, though few people make it explicit. Back in the 1950s, the average American family had one working parent and was able to get by just fine. Today, most families have two working parents, sometimes working more than two jobs and they’re still not able to live a stable life.

Indeed, a 2012 study by NYU Professor Edward Wolff found that the median net worth of American households was at a 43-YEAR LOW. The average American in the 21st century was in worse shape than his 1970s counterpart.

This process began to accelerate in the late ‘90s. Indeed, looking at real media household income, one can see clearly that things have generally been downhill for nearly 20 years now.

(Excerpt) Read more at zerohedge.com ...


TOPICS: Business/Economy
KEYWORDS:

1 posted on 07/29/2014 6:37:14 PM PDT by Lorianne
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To: Lorianne

The lack of wealth among individuals parallels the lack of real wealth of our country. Some day the markets will puke up the 40% fake money, the entitlements won’t be paid, and it will be very painful.

Just like the family in 2007 with a McMansion with negative real equity and two leased luxury SUVs. The appearance of affluence but no assets.


2 posted on 07/29/2014 6:42:18 PM PDT by nascarnation (Toxic Baraq Syndrome: hopefully infecting a Dem candidate near you)
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To: nascarnation

Mexico is looking to back its currency with silver. Will they get away with it? Who knows.

Back in ‘80s business school they taught us the 60-80yr ‘business cycle’ where the middle class is built up, then slaughtered for the wealth it managed to build up.

I guess they’ve devised a 10-yr business cycle now, with software guiding them.


3 posted on 07/29/2014 6:46:47 PM PDT by txhurl (2014: Stunned Voters do Stunning Things!)
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To: Lorianne

I knew a guy who once had a relationship with Bubbles.


4 posted on 07/29/2014 7:04:53 PM PDT by beethovenfan (If Islam is the solution, the "problem" must be freedom.)
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To: beethovenfan

I thought this was going to be another one of those “secret service guys getting into trouble” threads!


5 posted on 07/29/2014 7:08:40 PM PDT by 21twelve (http://www.freerepublic.com/focus/f-news/2185147/posts 2013 is 1933 REBORN)
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To: Lorianne

"Wait, what?"


6 posted on 07/29/2014 8:37:43 PM PDT by Jeff Chandler (Conservatism is the political disposition of grown-ups.)
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To: Lorianne

they are managing bubbles almost every morning.

just watch the 24-hr gold price. if they expect bad news for the dollar, they will dump gold on the market before the open. this drops the per ounce price which will slowly recover during the day.

this is also where all that gold went (i bet Germany is happy)

once all the gold is gone, they buy end of day contracts with newly printed money and then dump it in the morning at a loss. this gets the phoney money into the system while continuing to suppress the dollar


7 posted on 07/29/2014 9:30:00 PM PDT by sten (fighting tyranny never goes out of style)
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To: Jeff Chandler

funny


8 posted on 07/29/2014 9:36:23 PM PDT by steve86 ( Acerbic by nature, not nurture)
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To: Lorianne

Seems like it was about 50 years ago that good ole Nixon took us off the gold standard and opened the door to China. Right after LBJ introduced the welfare state with his war on poverty.


9 posted on 07/29/2014 9:49:42 PM PDT by tinamina
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To: tinamina

Yes, odd coincidences those


10 posted on 07/30/2014 7:28:01 AM PDT by Lorianne (fedgov, taxporkmoney)
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