Here is a little note to the average American.
The fed audit turned up a little secret. The Fed printed and loaned out $16T behind closed doors, and they seem to have forgotten to tell us.
Don’t worry, the media just forgot, and that is why you forgot about it, too, right?
Hey, we are all getting older, and dementia is the rage of the era. I know the media has had it, since I was a kid. Look how old Greenspan was, and Bernanke is no spring chicken.
Sorry to regress.
The $16T went along with the $4T bailouts previously to the banks. Thus, the banks got $20T, as best we can discover, thanks to Ron Paul’s “audit the Fed” work. Don’t be surprised if it turns out to be twice that much, if all the stones get turned over in a full audit that all in power refuse to allow.
It is important to note that the Fed Chairman, Ben Bernanke, did say that he was fighting deflation. Given that key, and the one pure economic principle of supply and demand, demand had to be shrinking. That is one of the only two true reasons for deflation. The other reason is increase in supply. Given the depression of the past few years, that is clearly not the cause. You will see in a little while that companies have no incentive to produce more.
OK, so when the Fed fights deflation, they are essentially creating some artificial inflation. That is easily done by printing money out of thin air. When there is more money, prices go up because people have more to spend on the same amount of goods and services. The “consumer bid” for the items goes higher when there is more money to spend. That is how inflation works. So, let’s get back to where the money went. We know that $20T got printed and distributed to banks.
Why haven’t we seen massive inflation?
We have. It is called the rise in the stock market. Again, the fixed supply of stocks were bid up by more money to buy that stock. Look out when the master plan is to sell those stocks.
So why did the banks want the stock market to rise?
Well, they didn’t really care, initially. However, when faced with an apparent call to help the stock market rise or get shut out of trillions of interest free loans, they got on board in a hurry. Literally, this rigged game wasn’t even disguised. As soon as the banks were bailed out, stocks went on a tear. Oh, I tried to get a small business loan at that time, too. I was laughed at, literally. Banks all made it clear that they had no money to loan. Right, they got $20T, and they had no money to loan to me or anyone else. It wasn’t just me. It was widely known at the time.
So who wanted the stock market to rise?
You will get that answer in the upcoming months before the election. Obama wants to get reelected. He and Michelle love the adulation, wages and perks of the presidency. If Obama can claim how great things are, because the stock market rose so much, you will buy into his having done a good job. Then, you will vote for him, right?
This also provides cover for Obama to claim that things are actually going fine. Also, under the same cover, companies can pocket the money (more on that in a bit).
Did all the money go from the banks to Wall St?
No. Remember the Fed was fighting deflation or the loss of the peoples’ interest in buying stuff, due to their loss of jobs, loss of equity in their house or investments and reduced wages. Still, we have had measurable inflation over every period. Thus, some of the money from the $20T made its way into the marketplace. People paid more for stuff because there was more money in circulation.
How did that money get into circulation?
The money went from the banks to government departments, too. $20T is a lot of money, even for bankers; so there was plenty to go around (except for you). Remember how fast the federal deficit has shot up. Well, the banks have bought government bonds, in addition to stocks. Those bonds are essentially government promises to repay loans. That is how the government operates and the deficit skyrockets. We print money with no collateral for big brother to increase his stranglehold on you. Those government departments are growing exponentially. Those extra bureaucrats get paid really well. They spend some of that money, and that causes the little inflation we have had, instead of the deflation we would have had.
How does this all fit together?
Think again of the trillions of dollars that went into this boondoggle. Again, you can’t conceive of $20T. One thing that does is to get a lot of pretty slick people scheming for that money, who we can call crooks, in this real world example. Those many people just run some fairly sophisticated spreadsheets to manage all these various “statistics” you follow.
So, are we really just puppets?
Yes. When the Fed can print money out of thin air, with no collateral for it, you are screwed. I could easily run the American economy from my office, with no help. It is easy when you have endless trillions to put wherever the cry gets loud enough. I could easily dole out just enough to keep the statistics inching forward. Oh of course, I’d reward sugar daddy (Obama) with a windfall just before the election. Hint…
So where does all that money end up?
This closes the loop. Look at the massive stock buybacks occurring now at major companies.
How can they be stuffing such huge amounts in their pockets when the economy sucks?
They are just pocketing their share of the $20T.
So, did the rich just get richer?
But what about me?
Your prices went up, when they should have gone down.
Jobs have disappeared. The companies have zero motivation to hire anyone, because they can buy back their stock with the money printed out of thin air. Why should they work to grow their company when they can pay it off from Fed free money.
Your house is worthless.
The government has passed so many new regulations that you can’t move without permission from big brother. Your freedom has vaporized, and it will get worse, because you are not fighting to stop them.
Why does the government want to screw me?
They want to own you. That’s book socialism or street communism. So, they kill your opportunity to prosper. When you are destitute, they throw you a bone. You love them for that at that time. Remember, you are destitute, and that bone is so welcome. So, welfare looks fantastic, when in fact, the American dream was extinguished right under your nose. You won’t even notice it, though. After all, you haven’t noticed the rest of this.
Am I really the one who got screwed?
No, your kids and their kids are who really gets screwed. They will really feel the pain of all this. They aren’t even at fault, but they will have to unwind this freedom grab and pay back the debt at the same time. Hey, you deserve to get screwed, because you are too stupid to even try to stop this. You won’t even vote for Ron Paul who will absolutely stop this madness. Your kids aren’t even at fault, and they will have it a thousand times worse than you. Don’t take it personally. You have lots of company who believes all the BS from the government and the media.