Posts Tagged ‘financial crisis’
Yellow Bricked Rhodes – IMF, World Bank, UN – SDR the Keynesian BanCor
Expansionary fiat monetary policy normally involves a lowering of short-term interest rates by the central bank.
However, when such interest rates are either at, or close to, zero, and money can’t be given away because of the Hostile Economic Environment, standard fiat monetary policy can no longer function, and quantitative easing may be used by the monetary authorities in order to lower interest rates further out on the yield curve to lower than Zero in an attempt to force stimulate the economy.
With Quantitative Easing.
Quantitative Easing (QE) is an unconventional monetary policy used in fiat central bank systems to stimulate their planned and controlled economy. With no external buyers or purchasers available, (citizenry, business or foreign investors) the central bank creates money which the bank itself uses to buy government bonds and other financial assets backed by future public tax obligations (or Monetizing Debt), in order to increase the money supply and add additional reserves to the banking system; This Raises the prices of future products and financial assets purchased (which lowers the yield or quantity at purchase).
However Risks and Fraud in this system always include the policy being more effective than intended in specific economic areas and hyper inflation occurs (Weimar or Zimbabwe)
of not being effective enough in other areas, with the loss of sustainable value, banks opt simply to sit on the additional cash in order to increase their capital reserves for share holders and consolidate real commodity holdings by waiting for the increasing default and foreclosure trends in their present loan portfolio to subside.
Gold, silver, coal, oil any real commodity back currency in what is needed to have a true free market that is Just, Honest and Equitably of, for and by the people. It is required for the capital, the currency, the exchange to have, hold and represent real value in a legitimately open capitalist system.
When we start adding money to the bank in the Game of Monopoly, because the amount provided by parker brothers has run out, odds are the game will never end and the player will just go round and round a board filled, with no more room to build or change and with enough to pay every time. Not enough change or ‘freedom’ in the system and the game hits a draw, the merry-go-round broke down and further play becomes pointless.
If we do not stop playing this game nothing will every change and No one else will ever get a chance to enjoy playing.
Ben Bernanke Read My Lips – The Federal Reserve will not Monetize the Debt! The Broken Promise of Quantitative Easing coming to America
With the Dollar Dead What’s After the Fed? We Go Global or Go Local – Special Drawing Rights (SDR) or State Bank Initiative (SBI)