Four Financial Farces… All of Which Will End in Disaster

Phoenix Capital Research's picture

 At this
point the news out of the financial world is more insane than… well, anything.


Farce #1: Japan Can Bail Out… Anything.


First off,
Japan, which has a debt to GDP ratio of 200%, is bailing out Europe, which has
a smaller, but equally disturbing debt problem. Yes, one broke country (Japan)
is now trying to bail out an entire economic union, despite the fact that it
HASN’T succeeded in managing its OWN finances or economy in over 20 years.


Indeed, the
idea that Japan could bail out ANYONE when it’s failed to create any
substantial economic growth despite spending TRILLIONS of Yen should give you
an idea of just how out of control the entire financial system has become. We
are literally in the end game now. Unless martians come down and start bailing
out Earth, the great Sovereign Default will be in full effect within the next
six months.


Farce #2: Inflation is at 1%


Ben Bernanke claims that inflation in the US is 1%. President Obama has to
maintain that this is a fact with a straight face next week when he meets with
French President Nicolas Sarkozy who is witnessing food riots in Algeria due to
soaring food prices.


The Fed has
claimed inflation is under control for months now, proving that its members
must not eat food, drive cars, OR know how to read. Indeed, in order to ignore
rising prices in the US, you would literally have to not shop for groceries,
not pump gas in your car, not read the newspaper, and not have access to the Internet
or any financial news outlet.


I sincerely
hope that the Fed is not run by folks who fit this description, but after
reading the next farce, I’m not so sure.


Farce #3: QE is Working


Various Fed
officials have stepped forward to claim that its Quantitative Easing program
has worked. Correct me if I’m wrong, but I thought the whole purpose of QE was
to lower interest rates.


How then do
you explain the following?



As you can
see, interest rates have soared since the Fed implemented QE 2. It’s not like
QE has helped the US economy either: food stamp usage has hit new records since
it began.


And yet, the
Fed claims that QE is not only working but we need more of it. However, even
that farce pales compared to the next and final financial farce of today’s


Farce #4: The Folks Managing the Fed’s QE
Efforts Have NO Investing Experience


Then of
course, there’s the recent revelation that the Fed’s monetary policies
involving the purchasing of TRILLIONS of US Treasuries is in the hands of folks
aged 26, 29, and 34, NONE of whom have any investing experience what-so-ever.


And they’re
in charge of buying up TRILLIONS in US Debt.


Here’s a pic
of them at work. Warning, the following image, when coupled with the
significance of these folks’ responsibilities, may cause a severe mental



If, at this
point, it’s not clear that the entire financial system is not a disaster
waiting to happen, then I don’t know what else to say. Indeed, our entire
system is built on fraud and managed by folks who don’t know what they’re
doing. And if you think they’ll get us steer us to safety, consider that around
the globe we’re already beginning to see signs of systemic collapse.






PS. If
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