Note to reader: More investment professionals are slowly coming to the same conclusions we rendered three years ago. The central banks can never cease building their balance sheets through QE. Central bank officials may pretend to talk wind-down, like in the European Union, but they are either whistling past the graveyard or are outright disingenuous.
While QE may take a number of forms, depending on the nation and circumstances, the verdict was already rendered in 2009, when QE began. There is no longer enough organic investment demand to absorb the growing sovereign debt pile. As this pile grows, the central banks have made it clear they will make up for the difference. The central banks cannot backtrack now and will finish what they started. Barring a force majeure that saves the day for the central banks, the final outcome will be disastrous. But this day of reckoning may be a number of years into the future.
Here is another interesting observation; the central banks don’t seem as concerned about the growing asset bubbles like they once were. My worry is that they may help to engineer even larger bubbles to keep the system going until that force majeure. If this turns out to be true, we may see asset prices rise in value that would make today’s prices look like bargains.
Of course, the elites determined that the QE programs were the most expedient routes for them to consolidate the global wealth. All of the subterfuge and economic research behind it are just red herrings to keep people from understanding the truth.
Why is Mises.org so surprised? Are people that obtuse?
“The glory which is built upon a lie soon becomes a most unpleasant incumbrance. … How easy it is to make people believe a lie, and how hard it is to undo that work again!”
I came across an article this afternoon from Mises.org titled, The Fed Is Moving to Take Even More Control of Debt Markets and Interest Rates, and wanted to quickly comment on the author’s astonishment that the Fed may begin to take over the entire yield curve.
The Fed’s overpowering impact on short-term as well as long-term market interest rates would be cemented. It may not even be an exaggeration to say that the Fed is about to become the “master of the yield curve.” Looking ahead, it seems that credit market yields will be influenced predominantly by what investors expect the Fed to do in the future — and to a much lesser degree by peoples’ expectations about future growth, fiscal deficits, inflation, and credit risk, to name a few.
The bond market would become chronically rigged. This spells trouble, for sure. For the market interest rate is of critical importance for bringing savings, investment and consumption into line. In a truly unhampered market, the market interest rate is determined freely by the supply of and demand for savings. This process makes sure that sufficient resources are at hand to realize all investment projects which are encouraged at the prevailing market interest rate – and the economy can prosper.
However, the Fed increasingly corrupts this process. It inadvertently suppresses short- and long-term interest rates to artificially low levels — levels that are lower than the interest rates determined in an unhampered market. As a consequence, savings decline, consumption rises, and investment expands. While this boosts economic activity in the short run, such a “boom” causes severe problems that will only surface later: a distortion of the economy’s production and employment structure.
The Fed Is Moving to Take Even More Control of Debt Markets and Interest Rates, Mises.org, Dr. Thorsten Polleit (Economics), March 4th
Three thoughts jump out when I read these types of articles;
- The observations of these knowledgeable individuals seem to point to one of astonishment and incredulity. They speak in the conditional tense, as if the Fed already doesn’t have full effective control of the yield curve and the asset pricing mechanism. Of course they do. The Fed will not just become the “master of the yield curve,” it already is lord of the manner. Why the coy disguises? I have to believe that on some level these learned people are in complete denial of the obvious.
- They often intimate that the central bank chiefs do not know what they are doing or are misguided. They think that people like Jerome Powell and Mario Draghi are open to reason. I say these bank servants are only following their orders. These central bank front men need to confuse while the well-coordinated financial rape of humanity transpires. These front men probably don’t even know why they are doing what they are, but have orders from above to make it so.
- If anyone sat down with this author and explained the ideas we espouse, he would reject, out of hand, any notion that there are hidden agendas behind QE and the other programs.
It’s this denial and disbelief that support the agenda. It is hidden in plain sight for all the world to see. Moreover, the collapse talk of people like Michael Snyder helps further the elite agenda to buy up the world with money that was conjured up to keep the nations from collapsing.
In the middle of the country, the big news is “the farm apocalypse”. Last week, we learned that farm debt has now jumped 30 percent since 2013…
“Farm debt has been rising more rapidly over the last five years, increasing by 30% since 2013 – up from $315 billion to $409 billion, according to USDA data, and up from $385 billion in just the last year – to levels seen in the 1980s,” Perdue said in his testimony to the House Agriculture Committee.
As a result of this giant mountain of debt, a ton of small and mid-size farms are going under. As I noted the other day, farm debt delinquencies have now reached the highest level that we have witnessed in 9 years.
Investors Brace For Impact As The Cancer That Is Ravaging “The Real Economy” Starts To Spread – Michael Snyder (March 4th)
Chaos provides a perfect opportunity to consolidate the wealth
I read these sobering statistics and think of the wonderful opportunity that is being established for the well-funded globalists and their corporations. I think of the upcoming land grab that will take place in the farm belt as these food manufacturers, wealthy investors, and banks consolidate their wealth and power while the goy give away their birthright for some debt contracts.
Before all this QE is over and the world goes to war the central banks will answer the calls of the Cassandras by hoisting assets like farmland on to their balance sheets. They will own it all. Meanwhile, well-educated PhD economists will scoff at any notion that this could have been done by design.
Manufactured financial crisis is promoted to scare the average person to the core and shake the tree of wealth. The elites will reap their rewards.