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The Hidden Motives Behind The Federal Reserve Taper
Submitted by Brandon Smith of Alt Market
The Hidden Motives Behind The Federal Reserve Taper
"The powers of financial capitalism had (a) far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland; a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank... sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world." - Carroll Quigley, member of the Council on Foreign Relations
If one wishes to truly understand the actions behind private Federal Reserve policy, one must come to terms with a fundamental reality – everything the Fed does it does for a reason, and the most apparent reasons are not always the primary reasons. If you think that the Fed simply acts on impulsive stupidity or hubris, then you haven't a clue what is going on. If you think the Fed only does what it does in order to hide the numerous negative aspects of our current economy, then you only know half the story. If you think the Fed does not have a plan, then you are sorely mistaken...
Central Bankers and their political proponents espouse a globalist ideology, meaning, they are internationalists in their orientation and motivations. They do not have loyalties to any particular country. They do not take an oath to any particular constitution. They do not have empathy for any particular culture or social experiment. They have their own subculture, with their own “values”, and their own social hierarchy. They are a kind of “tribe” or “sect”; a cult,if you will, that views itself as superior to all others. This means that when the central bankers that run the Fed act, they only act with the intention to support and promote globalization, not the best interests of America and Americans.
The process of globalization REQUIRES the dissolution of the U.S. economy as it exists today. Period. There is no way around it. America can no longer remain a superpower in the face of what globalists call “harmonization”. The dollar can no longer maintain its petro-currency status or its world reserve status if total centralization under a new global currency is to be achieved. Globalists believe that America must be sacrificed on the altar of “progress”, and diminished into a mere enclave, a feudal colony of a greater global system. The globalists at the Fed are no different.
Once this driving philosophy is understood, the final conclusion is obvious – the Fed exists to destroy the U.S. financial system and the U.S. currency mechanism. That is what they are here for.
This is why the dollar has lost 98% of its value since the Fed was established in 1913. This is why the Fed deliberately engineered the derivatives bubble crisis through the implementation of artificially low interest rates. This is why their response to the crisis was to create yet another massive bubble in stocks and bonds through QE stimulus. This is why the Fed is cutting stimulus today.
How does the taper play into the long running program of dollar destruction and globalization? Let's take a look...
The Multifaceted Taper Strategy
In my article 'Is The Fed Ready To Cut America's Fiat Life Support', and my article 'Expect Devastating Global Economic Changes In 2014', I predicted that a Fed taper was highly likely. Central banks almost always implant policy shift rumors into the mainstream media a few months before they implement them. They did this for TARP, for QE1, QE2, QE3, and the Taper. In fact, the Fed spent the better part of the past quarter conditioning investors to the idea of stimulus cuts, so I was not at all surprised when they followed through.
The Fed has, of course, now announced a $10 billion QE reduction just in time for Christmas and the 100th anniversary of the privately run institution. In the past, I have pointed out the tendency of central banks to enforce detrimental policy changes while the government, the economy and/or the bank itself is in the midst of a major transition. The Fed's taper announcement comes just in time for the end of Ben Bernanke's term as chairman, and the expected nomination of Janet Yellen.
This is done, I believe, because it provides an opportunity to divert blame for a crisis event they know is on the horizon. If attention is ever focused on the Fed specifically for a market downturn or bond disaster triggered by the ever present dollar bubble, Yellen can simply blame the QE policies of Bernanke (who will be long gone), while promising that her “new” policies will surely repair the damage. This placates the public and buys the central bankers time to do even MORE damage.
The taper itself is not just a “head fake”, however. It is a far more complex action. Tapering provides a method of psychologically distancing the Federal Reserve from the consequences of market movements. The banksters are essentially proclaiming to the public that their work is done, they have saved the economy, and now they are moving on, be it only $10 billion at a time. Whatever happens from here on is “not their fault”.
Most alternative analysts expected no taper of QE, and for good reason. While the mainstream touts the propaganda of economic recovery, independent financial experts understand that little to nothing was actually accomplished by the bailouts. Virtually no stimulus was absorbed in a localized way by mainstreet business. Real unemployment counting U-6 measurements still stands at around 20%. Real estate markets and home prices have a received a small boost, which at first glance appears positive until one examines who is actually buying; namely big banks and international investment firms snapping up properties only to reissue them on the market as rentals:
http://dealbook.nytimes.com/2013/06/03/behind-the-rise-in-house-prices-wall-street-buyers/?_r=0
U.S. holiday retail sales and annual retail sales have been the weakest since 2009:
The only thing that QE ultimately accomplished was a spectacular rise in stocks through direct manipulation, which Fed agents like Alan Greenspan and Richard Fisher now openly admit to. The problem is, while gamblers in equities proudly boast about the Fed induced bull run in the Dow and how much money they have made, they remain oblivious to the underlying cost of the charade. Market investors have been enriched, yes, but little do they know that stock legitimacy is about to be sacrificed.
The price to earnings ratio of stocks (the market value of stocks versus what they SHOULD be valued according to the actual earnings of the companies listed) in the S&P 500 today stands at around 15, which is the highest it has been since before the 2008 market crash. Mainstream economists attempt to dismiss the issue by using a 15 year average while claiming that the P/E ratio in 2013 is mild compared to the tech bubble of the late 90's. What they don't seem to grasp is that the market of the past four to five years is an entirely different animal compared to 15 years ago.
Stocks in general have received considerable support through purchases by Fed bolstered banks and the Fed itself, creating an atmosphere of artificial demand for equities using QE fiat injections. Though no full audit of the bailouts exists (TARP is the only measure audited so far), it is projected that the banking sector alone has garnered tens of trillions in Fed fiat, which they have used to bolster their otherwise debt ridden holdings. It is only logical to expect that this capital tsunami has been used by numerous companies as a way to present false earnings. Goldman Sachs, JP Morgan, and Morgan Stanley all reported substantial profits for 2009 while at the same time reporting massive liabilities caused by the derivatives crash so that they could collect on the bailout bonanza.
So which one is it? Are companies making profits, or are they wallowing in insurmountable debt while presenting government stimulus as a form of profit?
What the Fed and corporate banks have done is create a market in which neither earnings, nor stock values can be trusted. The fact that the P/E ratio is higher than it has been since 2008 despite this manipulation should concern anyone with any sense.
Worst of all, the Fed's monetization of U.S. Treasury debt has only expanded while foreign investment in long term debt has contracted. With our official national debt growing by at least $1 trillion per year, our country cannot continue to function without an ever increasing amount of foreign investment, or, Federal Reserve printing. The Fed cannot make cuts to QE if our system is to survive (if you want to call it survival), the Fed must expand QE forever, or at least until the dollar implodes due to hyperinflation.
So then, why has the taper been introduced at all? No one wants it. The government shouldn't want it. Investors certainly don't want it. Our economy is utterly dependent on the opposite. What purpose does it serve?
The assumption has always been that the Fed wants to keep the system afloat. I submit that things have changed. I submit that the Fed no longer wishes to prop up our fiscal structure, or at least, no longer wishes to be seen as propping it up. I submit that the Fed is not pursuing dollar destruction through standard hyperinflation, but rather, they are preparing the U.S. for default, which also will result in currency implosion.
The Taper Parallels
"It must not be felt that the heads of the world's chief central banks were themselves substantive powers in world finance. They were not. Rather they were the technicians and agents of the dominant investment bankers of their own countries, who had raised them up, and who were perfectly capable of throwing them down. The substantive financial powers of the world were in the hands of these investment bankers who remained largely behind the scenes in their own unincorporated private banks. These formed a system of international cooperation and national dominance which was more private, more powerful, and more secret than that of their agents in the central banks. " - Carroll Quigley, Tragedy And Hope
Initial shock over the taper scenario has not sunk into the markets yet (as Zero Hedge points out, the last time a major central bank cut stimulus measures to a dependent country, stocks rallied, then crashed within months). Few people see much difference between $75 billion per month and $85 billion per month, but the size of the cuts is not really the issue. Rather, it is the Fed's act of fading into the background that should concern us.
The taper announcement parallels perfectly with the accelerating debate over the U.S. debt ceiling, and I do not think this is at all a coincidence. Tapering seems inconceivable to many, but for the Fed it makes perfect sense if the goal of the globalists is to generate a default scenario while diverting blame. I believe that Americans are being prepared psychologically for just such an event. Already, the White House is warning that government funding will essentially disappear by the end of February:
http://www.reuters.com/article/2013/12/19/us-usa-fiscal-idUSBRE9BF1FW20131219
The expectation fostered by the mainstream media is that a debt fight similar to the October theater will not happen again. I agree. I believe the next debate will be much worse. The vast majority will assume that the “can” will be kicked down the road again, and they may be right, but given the Fed's behavior, and given that they have begun to taper despite what appears logical, many people may be in for a shock when our government also suddenly decides one day soon to buck assumptions and default rather than prolong the pain.
The full spectrum failure of Obamacare only adds excuse and incentive. There is no longer a legislative centerpiece rationale for further spending. Obama's approval rating is at historic lows for any president. The stage has been set for the most epic of fake political battles.
The Left and Right leadership, at the top of the pyramid, are nothing more than flunkies for the global elite. If globalists have decided that it is time to apply the final death blows to the dollar, default would be the quickest and most efficient way, and political puppetry can easily make it happen. The calamity would be blamed on “partisan bickering” and “government gridlock”, or even the inefficiency of “democracy”. The Fed, with its taper in place and its fake recovery established, would be presented as the only “sane” institution at America's disposal.
Perhaps at this point even more pervasive QE programs would recommence, perhaps not. At bottom, though, the taper is not a peripheral issue. It is an action at the center of a much more elaborate process, an action that seems to have been undertaken in preparation for a larger event. The next year is shaping up to be the most chaotic since the debt crisis began in 2008, and as the situation progresses, the subtleties of the Federal Reserve and the international banks that back it must not go unnoticed, or in the end, unpunished.
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And there you go, just what I've been talking about (for years)!
The Fed is being sacrificed. This was the agreement waay back when when TARP was first picked. They KNEW that the growth fabrication game was over and that instead of being direct reciipents of violence they'd continue along and prop things up knowing they'd eventually have to puke it all back up (of course, it all never really existed anyway). There's only one thing that one cannot get more of and that's TIME: the upper class bought themselves some time; and those paying attention [should have] also taken advantage of this.
Fed != US govt; sever relationship with Fed and start up something new (the "End the Fed" slogan/campaign feeds right into all of this quite well); and then our "law-makers" will be able to skip a bunch of squares and go directly to "Print Place."
I'm afraid we too will be sacrificed by the looks of the Dodd-Fwank FDIC bail-in legislation.
Easy come easy go... If you're holding a lot of funny money then funny business taking it away is a bit funny...
That fiat says right on it that it's owned by the Fed. I see no real problem with recalling a defective product. Of course, there's no refund; those not seeing it have no real understanding of what "risk" means: just because folks dress up in nice suits and publish all sorts of nice-looking documents describing how everyone is "protected" by this thing or that and are given nice-looking money (for doing "jobs" that most are mindless and produce, assuming "production" occurs, a bunch of non-sustainable crap), um... OOPS!
I suspect that we'll learn what reality is like, the reality that had slaves picking cotton, that natives were subjected to being herded up into "camps," what the billions who live on $3/day or less face every fucking day... You know, what do ALL of us do? I know! We slide in subtle derogatory slams at gay folks and whatnot, yeah, that's the ticket!
Yes!!!
"private central bank this private central bank that"
What a nonsense there is no such thing as public ownership. There is just people with guns and the right to initiate violence and plunder who own things and people who operate on voluntary basis to get ownership.
central banks are a government protected monopoly and that is why you get arrested by the government when you print money and that is why they buy government debt.
then this:
member of the Council on Foreign Relations
are you kidding me??
I agree that it pretty much boils down to this; however, I do believe that there's an intended value in all of this in that it's meant to stave off outright fraud; yes, we pay for this, but ALL risk comes with a cost.
Don't worry, this monopoly is going to end. Start stocking up on ammo, as the "replacements" will tend to be a bit more in-your-face...
My gang has already banned gun ownership except for themselves.
All I can do is bitch and moan untill my arrest.
"My gang has already banned gun ownership except for themselves. "
For the love of... man! You've got to find yourself better company!
I've had folks here accusing me of lying down and taking it. WRONG! Just because I won't sign up to some BAD "plan" to "resolve" matters I'm assumed to by sitcking my ass in the air to be raped. LOL! Stroll on to my property some time for a demonstation of how stupid of an accusation this is.
Life is worth fighting for. Stupid ideas are not.
Please read “World-Market State vs. Democracy” in The Economic Populist—to understand how phony academic efficient markets theory is applied by central bankers, to justify their private financial elites’ push for global domination.
Politicians buy into sham laws, supported by the counterfeit efficient markets’ theory, because investment bankers legally bribe or lobby them—or politicians are ignorant, and it is easier to go along.
The financial elite create about $700 trillion dollars of OTC derivatives. Consequently, a great deal of this bogus money is used to purchase influence in businesses and in politics.
http://www.economicpopulist.org/content/world-market-state-vs-democracy-why-we-should-go-over-fiscal-cliff
It's ALL based on an improbable premise: perpetual growth on a finite plant- you MUST have growth in order to keep the Ponzi going!
As much as I dislike the notion of "NWO" I do believe that it is never going to materialize, not because I believe that it is sinister (I believe that it's perfectly explained through evolutionary functions of systems organizing [efficiencies]- if you're in business then you realize that it makes perfect sense to do propert accounting so that you know what is really happening), but because this is really a last drive to create growth when none really exists.
"The financial elite create about $700 trillion dollars of OTC derivatives. Consequently, a great deal of this bogus money is used to purchase influence in businesses and in politics."
It's ALL LIES! It's all fiat! And if it's all lies, bogus, bullshit, then WTF care? You going to "fix" this? NO! No one is or CAN fix it: refer to my initial sentence above as to why.
after being involved in a few experiments in "Direct Democracy" that have gone horribly awry, i would make the contention that trying to save or defend Democracy without recognizing or acknowledging its inherent fatal flaws and seeking to rectify them is a large part & parcel of why the problem that you outline in the essay exists. Democracy did nothing to exacerbate or prevent this concentration of power & the illusion of wealth, but in fact enabled it and intensified its effects.
will say this again: the true enemy always lies within.
It does indeed.
A democracy of makers and takers can never succeed because the takers will always eventually outnumber the makers.
And when I say takers, I mean all takers, rich and poor.
I seem to recall a study that proved(?) that absolute democracy only scaled to something like 128(?) people.
Anyway, there's an excellent video out there (Youtube I'd imagine/recollect) of Allan Watts talking about why one is better off not trying to save the world. As I've noted, we don't even know what the real problem is, so trying to "solve" the unknown is kind of going to go wrong... as fucking wrong as how we're currently finding things.
And while I'm on the subject of NO DEBT CEILING DEBATE, please note how seamlessly the budget was settled, for two years, I might add, and passed, without a whimper from either side.
I doesn't take a genius to understand that the politicians know that they can't keep playing around like they have the past five years. The public is getting PISSED. So, just like they passed a budget (a complete joke, BTW), they'll raise the debt ceiling with ease and without rancor, because, in the end, they have more important business, THERE ARE ELECTIONS TO WIN, and, as we all know, that's all that really matters to them.
EXPANSION is the only thing allowed. All attempts are to push back against deflation; they ALL know this and that is why they agreed on this. Again, though, it matters little because the real world is going to make the ultimate decision (that we are unable to make).
The conclusion is going back to what was, just like fonz said. I really could care less what "it" looks like and "who" is (at first) responsible. I have a life to live, kids to raise, mortgage to pay.
That being said I am getting more prepared every day. What is funny is my two in college boys are home now and bring back news of enlightenment at two major universities here in the Midwest. The peeling back of the current realities has hit the XBox generation.
Have a Merry Christmas everyone.
Pherhaps better stated as: "No amount of caring or action is going to be able to rectify a bad system; better to apply one's energy toward making a new and better one (slight paraphrasing of a Buckminster Fuller quote about battling against existing system)."
While I am changing my life I can never figure that I'm going to be "prepared." I'm just hoping that what I'm doing gets me more days to wake up to... (as Derrick Jensen put it: "It's OK to hold two mutually constrasting views: 1) That we're all fucked; and 2) That life is really good!") I do believe that I can die happy...
What else is new in milleniums of world history. The wicked rule and the people mourn. To eventual peace on earth and good will toward all peoples.
Only solution is to stop believing in rulers/leaders/gods (collectively/institutionally).
I always enjoy reading Brandon's excellent essays ...in a morbid sort of way ;-)
On the US default possibility, I've been saying for about two years that there will be a Big Reset. This may begin in the US but will be quickly followed by other heavily indebted sovereigns and of course the EU. I have never believed there is any other way for the debt overload to be dealt with. It is unrepayable and seriously hindering economic activity. And such action is supported by the fact that these same over-indebted countries continue to run huge deficits like there's no tomorrow. It seems to me they already know that default is on the cards.
God knows how such an event would be taken by the US's major creditors.
Alter Net
Alternate Universe
the tougher it gets to make $$$ the more radicial/ludicrous/incredulous/miraculous storyelines get
n tks fp,itm96 and all ZH
"investment bankers who remained largely behind the scenes in their own unincorporated private banks."
Send our military's special forces to round up these criminals, repatriate our gold and other wealth and bring an end to this entitlement charade.
. . . my Christmas wish, or my first order as CIC.
Are you from Germany?
Why? Do you think the Nazis were the first or last people to perform cleansing operations?
Meh, haben ze kleina tungsten. Ideally, a Sovereign, freeman of character and not a 14th Amendment 'c'itizen. But, we know that the Sovereigns have been relegated to the dinosaur dustbin.
Merry Crisis, and a Happy New World Order!
Usually this is called 'pulling the rug out', after you get all the participants on it of course. History is full of this lesson, which never really changes, just 'dress', not the actions. The script remains the same. What is left out of course is the 8billion lb gorilla in our closet, Mother Nature and all her many cosmic cycles, all of which affect our little planet Earth. These cycles are converging and like the second hand, minute hand, hour and day, week, month, year etc hands of a giant clock, there is a transition at hand, foot and mouth. As the song goes, "It's the End of the World as We Know It". Check the 28 million yr cycle in Wikipedia(between 26 and 30) and you find a species extinction level event sequence and we and our pets and food sources are the only ones left. Look at the sun and even NASA points to the Maunder Minimum, but ignores the parabolic curves of major EQ and volcanic activity, comet activity etc, which looks just like our stock market activity in recent years, coincidental? The human cycle mirrors the larger cycles of existence. We are all energy fields after all. Interesting that the Bitcoin chart looks the same? A new last grasp of fiat currency for the internet age? One more for the road? Funny, but most of these guys haven't been informed it seems, as that line from the James Bond story put it: "We have all the time in the world." They seem to think they can reset the game but the game is about to be reset for us all.
Time to exit Platos' Cave and leave the banksters and their friends to play with the fire. Reality is something best not ignored. It is what it is. Deal with it, or continue to be distracted by their shadows dancing on the wall.
I love when people bring up the really BIG stuff! :-)
Not sure of the 28 million year cycle, but I'm a big believer in the earth performing large-scale tilling operations- glacial periods being the mechanism. Glacial periods tend to be a little rough on life forms, especially larger ones.
No, I'm not a "gia" person, mainly because I have a really hard time signing up to any club: I'd state that, if not for the fact that I'm married and have many responsibilities, I'm too non-commital to do so (I always have lots of recruiting pitches thrown at me; and come to think of it, it was "recruitment" into the military that probably soured me on joining "clubs").
Cycles account for much of history, but I credit a whimsical Creator that occasionally erases the chalk board to arrive at a better electro-magnetic calculus equation for the expression of Spirit via matter. ;)
Does anyone else find it interesting that in the press conference BB never hinted they would increase QE in future meetings. Rather, they might pass on decreasing for a meeting, if data worsens. Big difference.
"blah blah blah in private hands blah blah"
this is exclusively american paranoia. only in USA central bank is privately owned. everywhere else in the developed/developing world central banks are owned and managed by state governments. ain't managed on secret meetings.
Bullshit.
If you have a bank and do NOT live in Iran, China, and a few(Fewer and fewer, btw, Iraq, Libya, et al) it IS owned collectively by Rothchilds, Rockefellers, Walburgs, et al. Just like the Bank of England , the FED, German, French and the rest.
typical brainwashed illiterate who couldn't find Germany on the map. I actually live in Europe. central banks here are tools of statists not Rothchilds.
Like the Bank of England, for example? Are you related to the ostrich?
"The Bank was privately owned from its foundation in 1694 until nationalised in 1946."
check the facts before saying anything.
..."statists not Rothschilds?" They are one and the same, no?
no, statists are marxist ideologists
Rothschilds and co are just greedy
On the questions raised of the hidden agenda(s) on whether or not the Fed will "wind" vs. "unwind"...
Just who's going to keep funding them if tapering becomes a long term reality?
The ball really got rolling on September 10, 2001 and hasn't stopped since.
http://www.youtube.com/watch?v=j4dzECaBxFU&feature=youtu.be
So,does all that mean that it's a "GO" for the banker approved State of Israel to take out Hezbollah controlled Lebanon in January?That seems to be the next step in the war plan.Have to keep up the petro dollar scheme.Iran though is still the eventual target.
Article starts on the right note, but than goes into total schizophrenia.
Bankers measure success in money, while others may in something else.
Everyone wants to be successful in life.
Bankers including FED and other CBs are driven by containing status quo and increasing wealth for major shareholders and the boards.
While money printing is designed to fill the gap between "debt is money" oxymoron and actual money issued to preserve the status quo.
The real threat for banks are gold and rising in popularity BitCoin. The example of BitCoin being a threat is attempt by JPM to offence the game with it's own creation.
The attempts of major players are leading to eventual self destruction and they do use governments to issue laws to protect status quo.
Eventually they will self destruct and run for the exit, but no one knows how long more it is going to take. 2007 did show we are close, but something gotta die to be replaced with new. I hope we will witness it during our life time.
Globalization - there is no way out of it. It is happening. While author likes status quo and thinks America is special - it is not anymore. People used to come to America because it was easy to live and do business without restrictions. Now America has almost as much restrictions as China or Russia and people denounce their citizenship.
Pretty close... but there will not be any "NWO."
Just look at the problems the EU is having, and these countries are fairly in line with each other (one could argue some finer points, but on the whole I think I'm right). Now imagine having the US, China, Russia and the EU all agreeing on shit.
All the electronic shit will continue to serve smaller and smaller sets of people until there just ain't the energy to stem the tide of entropy (which is often cloaked as "human terrorists").
I suggest that the soundest advice I could give anyone is to seize the day. Make every day count. Don't assume that you're gonna get another one; yet, don't assume that you won't- ensure you've got some planning in there for beiong able to awaken to another day. Food, shelter and water- start from here and then proceed...
Exactly Right Seer, As fewer and few people will be able to enjoy the "Modern" electronic life. The greater number folding their hands and not being able to play any longer. They will overwhelm the "Haves" sometime in the future.
Everyone should heed your "Soundest Advice" and prepare themselves, family and close ones. Seize the day indeed. Stock up on useful long term goods, learn skills, and PREPARE.
Pretty close may be measured in days, months, years or even decades. It all depends on sheeple when they can no longer feed on the grass they are given.
If one reads the book, you will find reference to efforts in restoring the gold standard as it existed in 1914.
Devaluation is historically the resolution in the US. The default path seems unllikely.
I agree with this. You'll wake up and the dollar will be halved. I could be wrong though. I've learned this year that I cannot predict anything nowadays. I have my insurance and I live one day at a time.
Devaluation of the currency is as good as default as creditors get left holding the bag. In this case it would be a bag of dollars that buys a great deal less. That is why the Chinese have been filling their boots with gold in the last few years.
The $85 billion per month figure was bogus, more like $120 billion per month. The Fed does some things on the books, and other things off the books, like buying Treasury debt through shell companies, as Bob Chapman reported. I think the primary purpose of the QE stimulus was to finance the federal deficits, and also to keep the zombie banks afloat. The fed is saying that they plan to continue tapering, but no interest rate increases. If they really wanted to collapse things they could start raising interest rates.
Who knows if the tapering is real, or if the stimulus has been moved off the books? My opinion is that for now the Fed can continue to hyperinflate the monetary base, because it is offset by decreases in money velocity and the money multiplier. But the multiplier and velocity can only go so low, and then the increase in the monetary base will probably cause high inflation, or the fed could stop inflating the monetary base, but that would lead to higher bond rates and a federal debt default. So they do seem to be running out of options, just a question of how much longer the velocity and multiplier can decline.
"The Fed does some things on the books, and other things off the books, like buying Treasury debt through shell companies, as Bob Chapman reported."
Of Course.
Like their member banks do. Get $100 and loan out $1000.
Mark to fantasy bookkeeping.
"I think the primary purpose of the QE stimulus was to finance the federal deficits, and also to keep the zombie banks afloat."
Absolutely. And logic readily backs this up.
If banks started dropping that would force open the derivatives pit of snakes (and we'd all fall in).
And, correct once again for stating the concern lies with velocity! If people don't have the money to spend then that money doesn't circulate, and without circulation much of the finanicial system that relies on transaction-based fees is going to bleed more (and if they're sitting on a bunch of fucked up mortages as well?).
I liken it all to stepping harder on the gas pedal as one starts to feel the car buck from low fuel. Of course it's silly! Which is why they have to do a bunch of shifting and jumping up and down- to force a momentary increased flow from the diminishing stream of fuel. It works, IF, that is, there's a gas station ahead... no suck view to be had. Time to start praying for abiotic oil?
Oh id like to give it to them in the end. With a BBC.
When i see pulitzer prize quality content on this site - i recognize ZH will never be allowed to win a Pulitzer so what i do is click the banners because that generates revenue for the site to they can continue to pump out more pulitzer quality articles
Click the facking banners fuckers!
I have a different approach. Any ad I have to click on to make it get out of my face or shut it the fuck up - I put it on my list of things to never never buy. That goes doubly for you -fucking toasted miniwheats.
They are a kind of “tribe” or “sect”; a cult,if you will, that views itself as superior to all others.
They sure are and they sure do.
Coincidental that the fed basically stops at 4 trillion and there is 4 trillion in emergency funds available to go to the banks without congressional approval in an emergency... (Passed on xmas eve 2009).
From my perspective, the fed is deep in concentration and quite serious about fulling it's raison d'etre, to be the fairy godmother to the banksters. This is akin to a state of being like that of a teenage boy. Both will say anything to get what they want. And to take the analogy one step further, both can experience unintended consequences when they do get what they want.
So are the Jews behind this conspiracy. Really, a lot of garbage gets posted here.
There are no hidden motives. The Fed has monetized debt for as long as it has existed. The "powers that be" here in America wanted the same levers that the BoE had. Hamilton recognized debt monetization and control of the Treasury markets long before the Fed formally existed - he stole the game from BoE history.
Independent and local markets are a solution away from centrally controlled banking system and planned economy: the power of markets between people.
I think that the way-back machine could attract a lot of demand for dialing back to the days of Hamilton. Sadly, Jefferson lost the battle.
Gotta love the way-back machine though.
Taking the "power of the purse" out of the hands of government is the key for me. It doesn't have to be strictly local. Gold is gold, silver is silver. Liberty. Next time around maybe we can keep the Hamiltonians out of the deal.
Here's to "next time."
Move in with SWAT teams. Arrest them wherever they are. Waterboard them until they tell where their stolen wealth is located. Lock them up and redistribute their stolen wealth into a publicly operated open source monetary system.
Don't let them get away.
Merry Xmas and Happy New Year from the Prez and the guys down the street in the big white dome!
In addition to the "Hidden Motives Behind the Federal Reserve Taper", we might also want to keep a close watch on this one as well.
Sure doesn't look like the statement the President made about the NSA is holding any water. The abbreviated compendium of our Laws in the year of our Lord Obama -that are no longer... Think of it as the wonderful 'second edition' to December 31, 2011 "A date which lives in infamy" And everything else that came before it on 9/11/2001!
Sure hope we're all awake at the punch bowl New Year's Day reciting 1071g(1)
"Key to the functioning of this information exchange will be the collection of “captured records.” Section 1071(g)(1), defines a captured record as “a document, audio file, video file, or other material captured during combat operations from countries, organizations, or individuals, now or once hostile to the United States.”...
Wouldn't you love to raise your hand and ask the nice psychopathic Dictator what "now or once hostile to the United States" will buy you in a gulag or torture facility? And let the notion of now or once hostile suggests that if you are no longer hostile we'll rape, torture and murder you anyway cause we can! Just ask the females in the military what Barrack Obama and Congress thinks of them when you finish the read at the bottom. If I were a mother and I had to make the decision about my daughter becoming a prostitute or an unwilling prostitute that makes less money with an assault rifle -the Army sure would be the way I'd want to go if I had to do it over again!
Cheers
http://intellihub.com/2013/12/21/bigger-badder-ndaa-2014-quietly-passed-the-house-and-senate-and-it-is-on-the-way-to-obamas-desk/
P.S.
A handy list is provided at the conclusion for those of you that want to get to know your Congressman and what they're thinkin about.
http://www.occupycorporatism.com/propaganda-trance-2014-ndaa-approved-me...
Another version done well
A great article that appears to have gotten only 135 reads:
Senator Jay Rockefeller ensured that attached as a rider to the 2014 NDAA, proposal S 1353, there would be CISPA-like measures to maintain cybersecurity efforts with the backing and support of the federal government.
Rockefeller said his bill “creates an environment that will cultivate the public-private partnerships essential to strengthening our nation’s cybersecurity. I’ve always thought this was a great way to emphasize the critical need for a public-private approach when it comes to solving our most pressing cybersecurity issues.”
- See more at: http://www.occupycorporatism.com/propaganda-trance-2014-ndaa-approved-me...
http://www.veteranstoday.com/2013/12/09/wtc-scam/
Senator Jay Rockefeller ensured that attached as a rider to the 2014 NDAA, proposal S 1353, there would be CISPA-like measures to maintain cybersecurity efforts with the backing and support of the federal government.
Rockefeller said his bill “creates an environment that will cultivate the public-private partnerships essential to strengthening our nation’s cybersecurity. I’ve always thought this was a great way to emphasize the critical need for a public-private approach when it comes to solving our most pressing cybersecurity issues.”
- See more at: http://www.occupycorporatism.com/propaganda-trance-2014-ndaa-approved-me...
The announcement to taper was announced 2 days past the 5 year anniversary of the start of Zirp and purchases and yet, isint funny that no one sees or promotes the correlation? The giant moutain of long term asset purchases is beginning to roll down hill in earnest. Just like the retirement of the baby boomers, the initial effect is not that great, it is the long term cumulative effect that no one talks about. Someone at ZH used to post monthly stats on the distribution of this moutain of purchse maturity in a graph by date and amount but must have givin up in fultility about 2 years ago, but now is a good time to reinstate it, please.
Like GW '43 said at the time, this economy is based on nothing but confidence. As long as you beleive, everything is gonna be Ok. The faith of a mustard seed in the economy is all that is required. The more you look things like facts, stats and beliefs that things are not gonna be alright, the more you are fighting the truth of fiction -real life is always stranger.
http://www.zerohedge.com/news/2013-08-16/what-fed-owns-complete-treasury-holdings-breakdown
Prescient!
A few wise words from someone named Lord Acton:
'Remember, where you have a concentration of power in a few hands, all too frequently men with the mentality of gangsters get control.'
'History has proven that.The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.'
'Opinions alter, manners change, creeds rise and fall, but the moral laws are written on the table of eternity.'
'I'm not a driven businessman, but a driven artist. I never think about money. Beautiful things make money.'
Happy Christmas, one and all, and may your God go with you.
Good article.
But a few clarifications and elaborations are in order.
The author identifies "globalism" as a primary. But actually, globalism is only a means to the primary ends/goals of the predators-that-be. Their goal is total control, achieved by total power (which they call full spectrum dominance).
So yes, they are globalists... because they want to control everything.
But this goal is not at all arbitrary or accidental. The predators-that-be completely understand that if any place remains they do not control, the best, brightest, most creative and productive will leave their domain for whatever places they do not control. And their little domain would look like the sick joke it really is.
And thus is why the predators-that-be are globalists.
The author traces history back up to 10,000 years, and he (and others who posted in this thread) mention many other of the individuals who were predators-that-be [mostly or largely] behind the curtains. But this only illuminates recent history, and misses the fundamental nature of the entire scam the author discusses.
The real history of this phenomenon goes... all the way back in human history. I will endeavor to explain in as short a manner as possible (which never works).
Long, long ago... say... 100,000 years ago... humans were predators, just like all other large carnivores. The human modus-operandi was "get away with whatever you can", just like predators of all species. While that is the modus-operandi (their behavior), the fundamental point is the following. Humans (and other predators) consumed whatever the natural processes of their environment produced. This was nature, this was natural, and no human knew any better... until...
One day, some dude was far from home hunting and gathering food for himself and family. When he got to the river he had to cross to get home, he found that rains had caused the river to become much faster moving and very dangerous.
He realized he could barely make it back across the river without dragging the pouches of fruit, nuts and veggies he had gathered. So he buried his eight pouches in eight different but recognizable places near the shoreline, then swam across the river and swam home.
For reasons that aren't important to convey here, he couldn't get back to recover his goods for several weeks, at which point he figured the stuff was surely rotten. And so he decided to accept his loss, and pushed the event from his mind.
However, a few years later he happened to take the same route when moving himself and family to what he hoped would be better conditions. When he arrived at the river, which was now conveniently calm and low, he recognized the strange rocks that marked the location where he burried his eight pouches of goodies years before. He noticed that in the exact spots where he burried his eight pouches were eight clusters of bushes or trees. Huh, "strange" he thought.
He helped his family across the river, then took them to the trees to investigate out of curiousity. He then noticed something very strange. Each clump of trees or bushes bore only one type of nut, fruit or veggie. Huh. What was even stranger, he noted, is that the eight clumps of bushes or trees were exactly the same eight nuts, fruits and veggies he had burried.
It was amazing to see, 100,000 years ago, a Thomas Edison style lightbulb appear above his head, and shine brightly. He understood! He realized the quantity of food on these bushes and trees was enormously greater than the contents of his pouches... and... that planting only one nut, or one seed would result in a whole bush or tree full of food given a few years --- at most. He wondered how many years these bushes and trees had already been producing food. For the first time, a human being uttered the word "awesome"!
He and family were the first humans to stop being predators.
He and family were the first human producers.
They found a large empty flatish field near the river, and carefully planted single seeds and single nuts in rows, separated by the space between full size bushes or trees. His wife and kids didn't fully understand, but he made a game of it, and the kids played along.
They found a place near the top of those strange rocks where they could climb, but predators like lions and tigers could not reach, and they made that their home. When the plants became large enough to produce nuts, fruits and veggies, they spent their time keeping small animals away, who would come to eat the abundant food. In fact, their "food magnet" made it quite easy to capture animals for food, because they tended to stay around once they discovered the bonanza of food.
Even the first year their plants began to produce food, they had vastly more food than they could possibly consume. They had massively, egregiously, astronomically underestimated how much food a whole field of plants would produce!
By now the wife understood the phenomenon, and suggested they could do the same thing with animals as they did with nuts and seeds. So they stacked up thorned bushes at the opening of the box canyon next to the rocks that were their home, and let loose goats, chickens and cows in their "fenced" in coral of sorts, and brought them food from their field every day, and water from the river.
Fortunately for them, the following few years had many days of gentle rains, and no long periods of drought.
At the end of a few years they had so much food on the bushes and trees, they couldn't possibly eat one thousandth if they stuffed themselves every day. And they had so many animals in their coral, they couldn't possibly eat a fraction of them either.
So they hatched a plan. He and his oldest son tied a bunch of animals together with vines, and loaded them down with all the nuts, fruits and veggies those animals could carry. And they set off on a two-day trek to the nearest settlement of any size. They would trade their stuff for... well... whatever other people had. At the very least, they could gain a little variety in the food they had to eat, and trade some items that spoil rather quickly for other items that last much longer.
And so they did.
And so they became the first large-scale traders too.
And so they became the first teachers of productive skills. They carefully recruited people who seemed alert, strong, insightful and benevolent to come help them care for their farm. They promised to let them learn the secrets that led them to have such huge quantities of goods, and let them do the same for themselves, in exchange for helping them with their own work. Naturally, it didn't take long for the new folks to catch on to this simple process, and replicate for themselves.
And so, in just a few more years, the quantity of food flowing from this valley was positively enormous... like nothing that had every happened on planet earth. Each human was a producer, and each individual found they could produce hundreds to thousands of times as much as they could consume.
But of course, in a world of humans who were almost entirely predators, it had to happen. A few humans figured out they could do even better. Why invest all that time and effort to plant, water, tend their crops and animals --- when they can simply come at night and steal as much as they want. And so they did.
THIS is where the story the author tells actually begins.
THIS is where humans invented what we call "ethics".
And by nature of their situation we know which group invented "ethics" --- the producers. The predators had no need for anything they didn't already have. Their modus-operandi was "grab whatever we can get away with", and this remains the modus-operandi of predators to this day.
Now that predators figured out how they could invest zero time and effort, yet realize virtually all the benefit of the time, effort, knowledge and experience of the producers... they did. And at this time, the producers clearly understood they had ZERO incentive to produce any longer. Why bother, the human predators would simply steal their goods and goodies, and if they attempted to stop them, the predators would just kill them dead.
The producers had found a way to avoid most dangers of the wild. Since they stayed in one place most of the time, they knew the environment well, could invest time and effort to create places to sleep that other predators could not reach, and generally avoid life-threatening situations. And the producers liked that aspect of their new-found lives.
Of course the human predators were all about violence. Violence and threat of violence is the way predators behave.
The producers attempted schemes, like sleeping in shifts so someone could guard their crops and goods, but the predators always had the upper hand. The predators could spend full time figuring out ways to get away with what they wanted, while the producers had to spend most of their time producing.
At any rate, producers identified the fundamental principle of creation and production to enunciate and formalize their unwillingness to give up being producers, and their unwillingness to let predators destroy their great advance.
This principle is what we call "ethics" today, and it was nothing more than a 100% natural identification of causality (cause and effect) applied to human action.
Every individual should enjoy/bare/suffer 100% of the consequences of his own actions, and enjoy/bare/suffer 0% of the consequences of the actions of others.
And thus was ethics correctly formulated 100,000 years ago (plus or minus).
No need for "gods", no need for "authority", no need for anything arbitrary, just the completely natural identification of "creation by man". A human who takes actions that cause things to come to exist that would otherwise not have existed, "owns" those things because his actions are cause, and the goods he created are the effects.
-----
THIS is the single most fundamental story of man.
THIS is the conflict between humans that has not been resolved.
THIS is the conflict that predators won, for all intents and purposes.
And this is just pitiful. I left out quite a bit of this story, some of which is important. For example, after the story and techniques of those first human producers spread far and wide, more humans attempted production... and most of them succeeded wildly (at least compared to their hunting and gathering).
As illustrated the story above, production is vastly, vastly, vastly more efficient at producing goods and goodies that humans need to survive and enjoy life than the random processes of the environment on earth.
One enormous consequence of this greater efficiency is... the human population exploded by a factor of many thousand time larger.
Which means, if all humans abandon production and all return to being predators instead, at least 99.9% of human beings must die, because that is all the natural processes of the earth environment will support.
And so, that is what advocates of predators want, whether they know it or not.
Of course, the more thoughtful "top-level" predators understand all this. In fact, I seem to be almost the only human who understands all this who is not a predator. The [top-level] predators very much need to understand this, of course, in order to chart their globalist plans for planet earth.And in fact, within the top-levels of the predators-that-be, there is a mild disagreement about this issue. There are two main camps.
#1: Kill most of them.
#2: Kill almost all of them.
These predators-that-be know much more clearly than producers the following totally fundamental facts of reality:
#1: Predators need producers... to produce the goods the predators need to survive and enjoy their lives.
#2: Producers have absolutely no need for predators, gain nothing from the existence of predators, and suffer great losses and harms from predators.
In other words, the predators know they 100% depend on producers.
But producers never bothered to notice this fundamental fact of reality, even though it is the fundamental story and dynamic of human existence.
Which is why producers allow themselves to be enslaved to the predators, and a great many of them sanction and/or support and/or defend... and finance them.
-----
This story, and the significance of it, are so astronomical and so... well... unbelievable but obviously true... that the mind can only boggle when it comprehends the sad state of pseudo-sentient-life planet earth.
In a word... REVOLTING.
Unfortunately, the predators-that-be specifically, and more widely the whole predator-class, and even more widely the hoards of every-day predators and parasites have almost total control of humans on planet earth, including almost all the producers.
Which means... humans are finished.Why? Because productive humans will not even be bothered to comprehend the very most fundamental story and conflict of mankind (or more widely, of sentient beings). And so, they have no hope.
Flush it down - close the book on sentient life in this universe.
What a waste.
PS: Something very wrong with paragraphs. Trying to fix.
I do agree with our Author. It is and was a very good article. One of the best I've seen! I also agree with you that there are related bands of predators that do have your two options in mind! It is fairly well known in the ranks that either preadate or in studies of that history. Whether it will work out and most are gone and the cycle restarts or various groups and civilizations for their own forms of control preempt that doctrine. This is what makes a future fairly unpredictable. We do know that short term we are about to undergo huge shifts in poilitical power globally in the next decade. The selfish key is to be with a currency that will spend and be in an area that will not be in the midst of violence. In the meantime let's enjoy our right to talk about it.
The QE impact on bond rates is the 'rationale' that CBs are happy to talk about - the asset side of the balance sheet. What they will not discuss openly is what is happening on the liability side of the balance sheet. That is where the truth about how ugly our system's future really is.
The liability side represents the battle they are fighting, not the assets' side (though they will direct you at every opportunity away from it).
What is the actual impact on the liabilities of the central bank? Why does our system need to have such assistance, without which we would have seen colossal defaults around the planet?
We know that QE produces demand for longer dated bonds, raising their price and lowering their yield. However, on the liability side, it provides the liquidity into which massive deleveraging has been taking place. Banks are carrying massive amounts of base money at call with the CB because they have enormous uncertainty over their balance sheets. They have enormous uncertainty over their balance sheets because the general preference of the private sector is to deleverage, after many decades where banks enjoyed the opposite.
In a fractional reserve banking system, a contraction in systemic debt can place enormous pressure on individual intermediaries - indeed a sufficiently large contraction will result in systemic collapse. To prevent systemic pressure, debt must grow indefinitely. The illiquid nature of our banks in a credit contraction can be addressed on two fronts.
Firstly, the Government can step into the market with large budget deficits and keep the system's debt growing - which is fine so long as investors buy the bonds (or if they do not, just get QE to create the demand).
Secondly, the CB can inject liquidity to ensure deleveraging does not result in too much systemic retirement of debt.
Selling geared assets results in private debts declining in a deleveraging environment.
Unless there is a return to private demand for debt, any attempts to reduce QE risks a return to the preconditions of a debt deflation. Should the latter occur, it is simply a matter of having one's investment returned - not being concerned about the return ON the investment.
In such an environment, a bond market catastrophe is a given, and a return to QE a hopeful but not certain, finger in the dyke.
I think that the idea behind QE was to allow banks to trade assets of questionable value for cash.
The fed would issue the funds for the QE and trade for those assets. In return the banks would inject the funds into the economy.
This would result in a healthier banking system and encourage those who have money to invest to start inveting in the economy.
The problem is that in a environment where interest rates are alost zero and few profitable opportunities are visible, the bankers just took the money to the casino, the stockmaket.
So now we have a wreck of a economy and a ticking timebomb that is impossible to defuse.
QE could have worked once or twice if done properly, but now its just life support.
The only reason for decreasing the ammount spent on QE would be to pretend that the economy is stabilizing, which is far from the truth.
I would think that the most effective way to repair the economy would have been to fire the entire staff of the federal reserve and let the economy recover on its own.
This was done in Iceland shortly before the crash. The banks were able to trade all kinds of trash for cash in the central bank in the days leading up to the crash.
Of course there are often some real assets behind securities and other products the central bank bought from the banks, like real estate for example.
I wonder what happened to that stuff. I suppose someone who was sweeping the floors in the CB basement made sure it was put into safe hands.
Got this book ( Tragedy and Hope 1966 print) from the library...needless to say, it is going to take a while for me to get it back up there.
Please don't forget. The USA citizen is the financial back stop for the banks.
It is still the case that if the banks engage in stupid risks that lose Billions of Dollars to the point of bankruptcy/bank-runs...YOUR taxes are on the line to cover the lost gambles.
Do banks still engage in gambles that are a foregone conclusion to fail? Simply to earn high transaction fees and justify massive bonuses?
Do I need to ask?
We are all muppets.
But muppets can exact violent revenge...that is the only corrective measure I can see available to us.