Well, the Federal reserve council has finally admitted it, things are not all peachy in the US as what the markets may seem. Late last week on there site they released there council report which clearly states that QE has been clearly ineffective and not just that has actually made the situation much worse. They also own up to how the stimulus program artificially inflated the financial markets and when the stimulus ends the majority of the US will have to once again pay the price.
… Sounds like recession once again.
Not good news for the US, in a nutshell and for those that do not follow such reports let me lay it out for you in a nutshell:
Firstly the Federal Reserve in the US has no interest in ending debt in the US, they have an interest in one thing and that is continual debt. Secondly the fed is not a government business at all, it is private, all they do is lend money and print money. How much they lend is out of the governments jurisdiction even though they act like they have a say. The act of 1913 clearly states the Federal Reserves role with the government. To print money and create more and more debt. At first it seemed like a good idea, the US had more money, but over time, the free money filtered into the banking sectors and too many businesses took on too much risk including the banks.
That is when the financial crisis started. Caused by an imbalance in the debt system.
Many argue that this crisis was a accident, yet in reality the evidence suggests that is not the case. Just like the bailouts funded those people that actually caused the crisis in the first place makes it obvious really. In any situation always follow the money as they say.
Okay, so a little off track there, QE was a filler, it never worked, it was a way to devalue money from the mass of citizens without having to tax them more. In a way it was a way to legally steal from the savers. Now the US once again is at a crunch time, banks are taking on more debt again than is stable and the financial markets are not representing real true value of assets.
Same goes for interest rates as well, many claim interest rates will rise again in the US soon, well that is all good and well, however if they do rise it means that the Government will not be able to pay back its multi trillion dollar debt and thus recession once again. Either way it is a tough situation for the citizens of the US as in any case it will be them that will pay for the situation no matter which way it goes.
Above – In the video above Peter Schiff goes over the Fed report and breaks it down for us.
If you live in the US, then comment your thoughts below on the situation.