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All Of Our Hopes & Dreams Come Down To 0.25%
Submitted by Simon Black via SovereignMan.com,
Charles Dickens opened his 1859 masterpiece A Tale of Two Cities with one of the most famous introductions in literary history:
“It was the best of times, it was the worst of times… “
This line is notoriously incomprehensible to high school students around the world.
But as paradoxical as it sounds, it truly hits the nail on the head in describing social inequality.
Dickens wrote his book about the struggles in England and France just prior to and during the French Revolution.
For the aristocracy it was the best of times.
These people were born into a life of unparalleled prestige and luxury simply by accident of birth, without ever having to work a day in their lives.
The working class, on the other hand, toiled away in starvation devoid of any opportunity, freedom, or hope.
For them, it was the worst of times.
Right now the Fed is going to meet in Jackson Hole, Wyoming to discuss what they’re going to do about interest rates.
Interest rates have been kept at zero for years, and now there is talk that they might raise rates to 0.25%.
This is far from a guaranteed thing. In fact, one of the most influential members of the Fed has already stated that with stocks swooning they likely won’t raise rates after all.
That tells you everything you need to know about the Fed. They’re not there for the economy; they’re there to keep stocks in a bubble.
Through their interventions they’ve created massive risks in the financial system, from which the tiniest elite has received disproportionate benefit.
Over the last four years, the top 80 billionaires saw their wealth increased by 50%, while the incomes for the rest of the population remained stagnant.
Adjusted for inflation, the average worker is actually far worse off than they were 15 years ago.
They are the ones who have had to suffer the consequences of the Fed’s actions.
They’ve endured gyrating financial markets, banks that are pitifully capitalized, and insolvent national pension funds—taking all of the risk, but none of the reward.
It might not be the worst of times, but with inequality rising, it’s getting there.
There’s nothing wrong with inequality itself.
There are no two human beings on the planet who are equal. In fact, even trying to strive for equality is both impossible and really boring.
We all have different talents and different productive abilities.
I’m never going to run as fast as Usain Bolt, and I’m just going to have to live with that.
The issue arises when people are able to disproportionately benefit without having to lift a finger at the expense of the rest thanks to a corrupt financial system.
When an entire class of people is able to grow wealthier to the tune of trillions of dollars, simply because central bankers print money and stick everyone else with the bill—that creates huge problems.
Right now, while the Fed is meeting in Jackson Hole, there is a group of activists also meeting there to protest against Fed policy.
100,000 people have signed a petition telling the Fed not to raise interest rates.
They claim that the recovery has only helped Wall Street and the wealthy, whereas for the working class wages haven’t gone up at all. And they’re right.
But what is really sad about this is the fact they’re begging the Fed to not raise rates until wages have gone up.
All these people have their hopes and dreams tied on a quarter of a percent.
That’s how ridiculous things have become.
People are so horrified that if money isn’t absolutely free that all hell will break loose—that people are going to go broke, the market’s going to crash, and that there won’t be any jobs.
That’s a pretty sad state of affairs, and it is by no stretch of the imagination the foundation for a free and prosperous nation.
It is the height of central planning and it is a form of economic tyranny.
Fortunately, this system is on the way out.
Nations are going bankrupt, entire banking systems are nearly insolvent, and national pension funds are already broke.
Governments and central banks have backed themselves into a corner with no way out.
Just look at China: one of the most authoritarian governments in the world can’t control its own market.
And that’s what’s so exciting.
When everything they try isn’t working, it’s clearly time to hit the reset button.
And for those who are ready for it, this will bring a whole new world of opportunities.
Dickens closed his book with a poignant quote that I think it very fitting here:
“I see a beautiful city and a brilliant people rising from this abyss, and, in their struggles to be truly free, in their triumphs and defeats, through long years to come, I see the evil of this time and of the previous time of which this is the natural birth, gradually making expiation for itself and wearing out.”
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Nope.
the fake economy has real consequences http://www.philiacband.com/propaganda.html
Hope and Change ...for the 0.01 percent.
Obozobots must be feeling pretty doofus right about now.
Gonna set a record straight, here.
By and large a 25bp move up in rates will not damage the consumer. As a matter of fact as the consumer (aggregate) is a net savings sector of the economy, it would increase returns on bank deposits, MMMF's etc., to the consumer's benefit, albeit too little, too late as principle has been impaired already.
The guys who'll get fucked are the specs, the arbs, borrowing a squat and playing the Fianacalfuckyermotherville game.
So, what's to consider, except that there's no reason to raise rates from the prospective of the health of the economy.
DC is outa control.
clock it ticking on the israel samson option
they have been painted into a real corner, and mums the word it seems.
the most you get is "we approve" "we approve" from supposidly sane voices, and the silence of prep is deafening.
doom in days.
Don't forget derivatives. A money maker for the banks could turn high risk without some kind of offset....
The stock and bond market generally move inversely to interest rates. Zero interest, the extreme, points stock and bond prices toward infinity. A move from zero to .25 is a move from infinity to finite. To me this explains why the market got so very high and why adjusting to .25 requires a big market move down.
ZIRP blew a giant bubble. It is so wrong. It caused problems. The solution is letting rates rise. Even though it means a market decline, it is the cure, the right thing to do.
Title: "All Of Our Hopes & Dreams Come Down To 0.25%"
So the FEDs are a two-bit whore?
100,000 people have signed a petition telling the Fed not to raise interest rates.
BS. End the FED.
Id buy that for a dollar.
https://www.youtube.com/watch?v=z-q29hbEP04
"A wonderful fact to reflect upon, that every human creature is constituted to be that profound secret and mystery to every other. A solemn consideration, when I enter a great city by night, that every one of those darkly clustered houses encloses its own secret; that every room in every one of them encloses its own secret; that every beating heart in the hundreds of thousands of breasts there, is, in some of its imaginings, a secret to the heart nearest it!"
Yeah, not anymore thanks to NSA, heat sensing technology, etc. At least in Dickens' time the serfs had their secrets.
....and than Robespierre's Reign of Terror began in 1794 !!!
--------------
“I see a beautiful city and a brilliant people rising from this abyss, and, in their struggles to be truly free, in their triumphs and defeats, through long years to come, I see the evil of this time and of the previous time of which this is the natural birth, gradually making expiation for itself and wearing out.”
Simon, respectfully, the fed. has had it's decision made for it.
BTW the debt ceiling has been locked for almost 200 days. (Extreme measures monies) are being used to cover .gov payments.
The reported accumulated debt is now approaching $19 TRILLION.
It won't be long and the PBoC will be calling the Fed. PIKERS.
When if the the debt ceiling gets raised, it will take at least $2 TRILLION to cover the (1) year fiscal budget, and replenish the " excess reserves" budget.
Since when does the government get to use a budget "excess reserves", reserved for catastrophes, in such won~ton unexplained ways?
Apparently we all live in Area-51> of the 'United Banana Republic of Amerika?'
'United Banana Republic of Amerika?'
Is it racist to say this is racist?
Rand, you sneaky little devil, loading questions that can't be answered. :-D
I love ya man!
Geraldo Rivera, instructed me to tell you that I was being " politically incorrect"."I'm tired of getting made fun of."
-Geraldo Rivera
lol. Remember in the '80's when he got a chair smashed over his head?
That was priceless. Flying Chairs and Fists on His Talk Show x
That idiot has been married how many times?
Rivera has been married five times. The first four marriages ended in divorce. He married Erica Levy in 2003, and the couple has a daughter named Solita Liliana. Rivera has four children from previous relationships.
This guy is a regular FOX NEWS knomegarden ... He's Catholic, so Bill O'Neocon loves him.
He decided to get a law degree, but I can't find a BAR.
Maybe he's licenced in the Virgin Islands?
The white supremecist in that 'chair' show suggested that Jerry (King) was Jewish. Is there any difference? 6 Catholics and 3 Jews on the Supreme Court who routinely tighten the screws for the totalitarian state says no.
Insulting to banana republics around the globe. The U.S is, in every sense of the term, a paper republic.
https://www.youtube.com/watch?v=ZZgx6R5rahY
so, what you are saying is that the hopium is really extortion...
It's clear that the vast majority of the public today are still not aware how precarious the entire economic system is.
If the stakes were high in the 2008 environment when that crash happened, the stakes are far far higher 7 years on, given the increase in
higher nation/state indebtedness, higher levels of corporate indebtedness, higher levels of personal indebtedness. All of that indebtedness coupled with the slow down in economic activity worldwide, creates a very fragile socio/economic situation.
Mission Accomplished
People are so horrified that if money isn’t absolutely free that all hell will break loose—that people are going to go broke, the market’s going to crash, and that there won’t be any jobs.
People need to educate themselves ... and for sure, without the help of Mises Monks and Keynesian Conspirators.
Money is "a promise to complete a trade". Promises are free to make ... but you must deliver. That delivery is not free, but adding a cost of money should not be imposed on reliable traders just because some capitalist says so.
With a properly managed Medium of Exchange (MOE) process:
Now if that causes people to lose sleep and jobs, it is clearly an education problem.
it's clear that the vast majority of the people have never had an original thought in their entire life and they'd be fearful of anyone different
I had that exact same thought last week.
0.25% rate rise phobia = something really seriously wrong after all these years
And that’s what’s so exciting.
When everything they try isn’t working, it’s clearly time to hit the reset button.
And for those who are ready for it, this will bring a whole new world of opportunities."
I'm not so optimistic.
The power of the "bounce" late this week tells me we're not likely to "see" Dickens's vision without a substantial push from the masses...overboard.
That's the kind of help the country really needs now.
m
It is NOT a 0.25% increase. We are not at the zero bound. We are losing our minds over ~0.12% increase. Doesn't change the fact that we're fucked, but let's call a spade a spade.
Was that racist? Asking for a friend.
The spread on mortgages has never been higher.
The spread on credit card interest rates to bank rates has never been higher.
The spread between a gallon of gas and a barrel of oil has never been higher.
The spread of the stock market to the true underlying economy has never been higher.
The spread of real vs reported inflation has never been higher.
Health care and insurance has never cost more than it does now.
Rents and home prices have hit new highs.
Essentially, we the average person have never been screwed more than we are right now.
Commodities have cratered but nothing has come down in price, other than gasoline by a small percentage in some places. We are still paying what we were paying for gas when oil was $90 a few years ago. That isn't progress.
Well said Sir.
I will bet the Millennials are at the bar right now and they should be. GenX gets drunk at home now to cut costs. Being that I live in a college town I get to see a lot of the next generation. What do we call this newest generation that is beyond Millennials? Where does one generation end and a new one begin?
The US economy is set up for a crash. They did that on purpose; thats their goal. We have a Perfect Storm coming up - probably next month.
"And for those who are ready for it, this will bring a whole new world of opportunities."
Oh Gawd...
Here we go again, ruining an otherwise perfectly rotten ending with 'Hope & Change'... Hey Simon? Allow me to give the 'alternative ending'...
The only 'opportunity' you're going to be looking for - assuming you make it to the other side of this diarrhea cyclone, is something to eat, shelter and safety with like kind from roaming bands of EBT-less thugs, who would just as soon cut your throat as look at you... There now, isn't that a much better (and realistic to!) ending...?
It seems these days either people are part of the 0.01% or are in debt up to their eyeballs so they are actually begging the fed not to rise rates. They should have never bid up the prices with the low interest rate money in the first place. But no these idiots buy on monthly payments.
It's high time to stop punishing the prudent. The hell with 0.25% raise it 2.5% or maybe 12.5%! More catering to debtors. The 0.01%, the speculators, and the working class who bid up the prices of houses because of low mortgage rates.
"100,000 people have signed a petition telling the Fed not to raise interest rates."
Ignoring the fact that interest rates should be set by the markets and NOT by central banks, those idiots are protesting for exactly the opposite of what they should be protesting for that is in their best interests in the long run, an increase in rates, which simply shows that the vast majority are TOTALLY ignorant on economic topics. These idiots might as well be working for the 1% because, in effect, they are.
Morons...
http://signforgood.com/letwagesgrow/
The twit organizations sponsoring this:
Action for the Common Good
Center for Community Change Action
CREDO
Daily Kos
Demand Progress/Watchdog.net
Economic Policy Institute
Working Families Party
"100,000 people have signed a petition telling the Fed not to raise interest rates."
So, that means 99.97% of the population wants a hike in rates......