1/16/16
Portugal is starting to bail-in banks. The
fascinating aspect that nobody seems to see is that this is a total failure of
socialism. The U.S. Federal Reserve was formed in 1913, with the shareholders
being the banks, to provide the cash needed to prevent bank failures. To
stimulate the economy when the banks could not or would not lend, the Fed was
supposed to buy CORPORATE notes. Then World War I came and the politicians
ordered the Fed to buy government bonds. Of
course, they never returned the
Fed to its original purpose.
FDR usurped the Fed, placed it in Washington,
and instituted a single national interest rate; each of the branches maintained
a different interest rate to attract capital when there were shortages in one
district. So it was common to see rates differ around the country based upon
the local economic conditions. FDR also created the FDIC because the Fed failed
to function during the Great Depression. The creation of the FDIC was sparked
by bankers who were willing to let a New York bank fail in 1930 that happened
to be named THE BANK OF THE UNITED STATES.
Bank runs began nationwide as people assumed that this Bank of the United
States was the government or Federal Reserve. The Bank of the United States was
a Jewish banks and the other bankers wanted it to fail to get its business.
When it was settled, the Bank of the United States eventually paid out 92 cents
on the dollar.
Then, for World War II, FDR ordered the Fed
to support the U.S. bond market at PAR. Therefore, bonds rose during the war
because of this support ordered by FDR. However, that was terminated in 1951
when we begin to see the long process of government bonds collapsing into 1981
when Volcker raised interest rates to insane levels.
With each economic crisis, the government has
failed to comprehend the cause and attributed effects to esoteric events that
are domestic. Even Larry Summers admitted he was not competent to forecast and
that economists have never been able to forecast a single economic decline
since World War II. Consequently, the response has been an ever-increasing
progression of attempts to control the economy by resorting to ever more
Draconian measures.
We have now gone beyond TOO
BIG TO FAIL to TOO BIG TO BAILOUT.
Thus, all the promises from socialism are collapsing from Social
Security, to pensions and insuring banks. This is what I have stated for the past 30+ years. We are
headed into BIG BANG (which began 2015.75),
which is more than just a sovereign debt crisis; it is the total collapse of
socialism and a crisis in democracy. We
have watched our forecasts made back in 1985 unfold on time and in perfect
harmony with history.
In Europe, not a single head of the Troika
has EVER stood for election!
The people dictating the lives and direction of Europe by forcing the euro down
the throats of everyone NEVER present themselves for election. The
European population has absolutely no chance to say these people are wrong or
decide to vote them out. There is
no democratic process and that is what, historically, leaves only one option — REVOLUTION.
As Bloomberg has reported, the bail-in has begun in Portugal. These people
will simply confiscate our money and now they are trying to move to electronic
money to prevent bank runs and hiding cash. The move to electronic money will
appear in Europe first.
This is BIG BANG — the total collapse of SOCIALISM as the result of politicians who are
incapable of, not just forecasting the economy, but managing it. If I managed
your money and lost it each month, then returned always asking for more, just
how many months would you continue to give me more money until you said enough is
enough? The mere fact that politicians raise taxes PROVES they are incapable of managing even a
bubble gum machine. They squander the money, and when the machine is empty they
simply rob us blind to fill it up again.
http://www.armstrongeconomics.com/archives/41912
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