The Fed is threatening to raise the interest rate from 0% to 0.25%, and Wall Street gurus warn this may be far too soon given the fragile global economy and the Chinese financial crisis.
The big-name economists and major banks say the U.S. economy is recovering.
To prove their point, they cite to lots of self-generated charts and graphs which I think is nothing but data-babble disconnected, like the economists are, from the real world.
Larry Summers, one of the many political shills that served as a Treasury Secretary, tells us that hiking rates right now "doesn't seem like a prudent risk" that the Federal Reserve should take.
The ever astute Mohamed El-Erian argues that it all depends on two factors. The old on the one hand this but, on the other hand, that argument.
First factor: A rate hike might be justified because in the US job creation has been robust, wage pressures are building, and the economy's growth engines have bounced back. He previously was for a rate hike to achieve the "loosest tightening" cycle in the modern history of the Fed.
I have to admit, I do not understand what he means.
Either something is loose, or it's tight. And the Federal Reserve has no ancient history.
And what modern history it does have is all bad anyway.
The second factor: The global economic environment has been unusually fluid in recent weeks. A rate hike by the Fed might cause greater turmoil. I guess fluidity in this context is defined as an economy getting flushed down the toilet.
Let's be real. The central banks of the world with Wall Street have been printing fake money to buy phony government bonds. They called it Quantitative Easing (QE) or infusing capital.
It's nothing more than a spurious effort to rescue both the politicians and the financial industry from going under because of their own malfeasance, misfeasance, and utter greed.
Governments have been on a bureaucratic expansion and welfare spending binge which Wall Street has been only too happy to facilitate to the tune of billions of dollars in profits.
And who paid for all this?
You got zero interest on your capital, but the Fed and Wall Street used your capital. They kept the interest. Effectively they got a non-recourse no interest loan which they figured would never be repaid.
Oh, some of you say how much the stock market went up. Record highs. Record highs only mean that there will be record losses.
Gary Shilling among a whole lot of others is telling you that the equity markets will crash. Just like in 1987 — sort of. An asset bubble is a term I hear a lot.
I still recall the crashes from 2000 and 2008. Don't you?
The Federal Reserve is supposed to regulate the financial industry, so crashes don't happen.
I have this right don't I?
If they were doing their job, then how did Wall Street and the big global banks and investment houses fix the markets for foreign exchange, gold, silver, bonds, credit-default swaps and it seems everything else that might be fixable?
Why would they do that? It' simple. The Federal Reserve and the other central banks fronted for their governments which also got their piece of your capital pie.
Government and Wall Street got fat on your interest while you financially starved.
Interest is the payment — the price — you are supposed receive when someone buys the use of your capital. The fair price is set by way of the free-market.
But neither the Federal Reserve nor Wall Street wants a free-market because then they would not have the unfettered control and freedom to steal your money.
They are scared stiff that once interest rates get pried loose from their tight fist, the days of easy money will be over.
There is a major battle happening between the economic forces of the controlled-market versus the free-market.
The Fed and Wall Street, and their well-paid facilitators in the media are desperate to use any excuse to keep on stealing from investors.
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