Why Is The Federal Reserve Choking An Economy In Recession?
Chance and Black Swan Events can make the best of experts look foolish. But what does it mean when each an every step is the worst measure that can applied, guaranteed to bring the worst result? This article is a part of the Rationed State documentary series. Please view Rationed State – Victory Gardens here.
Brandonomics has been at work erasing the success of the Trump presidency sector by sector. While Trump’s monetary policy did not focus on debt, he relied on the American “ingenuity” engine and unleashed unparalleled productivity and prosperity with policies that allowed the US to become energy independent, that repatriated corporate dollars to our economy and that began a process of brining manufacturing opportunities back to the middle class. The idea was to jump start the economy, then use the resulting prosperity to whittle down the crushing debt we have accrued.
For years many have acknowledge that the interest rates at 0 have allowed large lending institutions to pump too much cash into the economy with risky investments. When the supply of money, risk free, has increased, inflation occurs. Due to massive debt, to the tune of nearly 110 trillion dollars with underfunded federal government programs, the scary message was clear: should the bill come due, the US government would default, and the trillions required to fulfill debt obligations simply do not exist. In the 1980s, runaway inflation was cured by the rate hike by Fed Reserve chairman Paul Volker. While painful, the level of debt was no where near today’s levels, for the interest rate hike could bring inflation back into line.
But the Federal Reserve is no violating crucial rule: never raise interest rates during a recession when people are being laid off. From Michael Synder and Zero Hedge there is an analysis making the case that the Federal Reserve is purposefully killing the economy.
In Rationed State we discuss how under guise of patriotism during a crisis, behavior is changed. @Orangezipple1 found strong parallels with WW2 rationing. That arose in part due to long Depression.
— Son of Mighty Humanzee (@HZardoz) September 24, 2022
Well, here is another critical parallel 👇 https://t.co/EKhltunWsB
On news of the interest rate hike, the stock market plummeted yet again. We are so used to hearing this news we’re nearly conditioned for this development without it evoking shock and outrage. The Federal Reserve, who coddled financial markets and allowed the easy money flourish, has now yanked the rug out from underneath those they used to protect. This will send the housing market in the cellar, rapidly.
The prolonged downturn in confidence shows the housing market has been “in a tailspin for the whole of this year,” according to Pantheon Macroeconomics chief economist Ian Shepherdson.
“Activity tracks mortgage applications with a lag, and the early September numbers are grim, even before the full hit from the rebound in mortgage rates in recent weeks works through,” Shepherdson said in a note to clients on Monday.
“In short, the housing market is in a deep recession, which is already hammering homebuilders and will soon depress housing-related retail sales,” he added.
As many point out, a plummet in housing prices with impoverish members of the middle class who rely on the equity in their homes for retirement or for refinance. But mega financial institutions like Black Rock benefit in that troubled assets are now on sale. One family’s loss is another financier’s opportunity. Concentration of wealth in the hands of Black Rock is good for Black Rock and stock holders, but on a massive scale for the middle class it is a disaster. The middle class will lose their autonomy with their wealth.
The Zero Hedge article doesn’t answer the important question of why the Federal Reserve is doing this, but I will. The elite, and those who feel the future must engineered by technocrats who believe in total top down control in order to save the economy and to save the planet, need a population that is compliant to achieve their ends. That means creating desperation and driving people toward false choices. Erase people’s wealth and destroy opportunity, you create dependence, thereby removing all choices. You are now in the hands of those who might possibly agree with the Great Reset, or worse, with the Great Erasure where we just have too many people to manage during this crisis. Clearly if there is an economic meltdown, we may be called to make sacrifices and ration once again as we were during World War II . Further control.