Monetization of USTreasurys is occurring in a profound blatant fashion. Such action infuriates the Chinese creditors, while at the same time creates a huge rift between the US Federal Reserve and the USDept Treasury. The rift is political and will come to a head when Chairman Bernanke is due for renewal of his post in a few months. . China exerts its constant pressure on the USFed to end the Quantitative Easing efforts. Like doctors, they wish to apply a tourniquet to a gaping leg wound that bleeds a red river onto the pavement. The term is a funny euphemism, a sophisticated economist term for Heavy Duty Money Printing that results in destruction of a currency if not kept under control. The USDollar stewards are NOT demonstrating control, discipline, or even anything remotely resembling honesty or integrity. The USDept Treasury wants to continue funding the federal deficit, and for yucks, add any and every conceivable new program onto the books while the federal insolvent bankruptcy makes marginal additions not so noticeable.
The USFed engages in almost immediately permanent operations to snag the primary dealer USTreasurys gatherings bid at auction, for a simple shell game shuffle. The USFed engages in a sneakier but still obvious hidden bidder game with foreign central banks. They use USDollar Swap Facilities (with gargantuan funds) and bid heavily on the USTreasurys, evidence being the ‘Indirect Bid’ component. If not for the USFed buying most of the USTreasurys issued, the long-term interest rates would be rising quickly and with alarm.
If not for the USFed heavy buying, the USDollar would be doing a swan dive off a cliff into rough waters. As has been claimed in past work, the USGovt stewards of the wrecked buck can save the USTreasury or save the USDollar, but not both. Their monetization efforts here and abroad indicate a clear intention to save the USTreasury Bond. They put the USDollar at grave risk. The Weimar Territory lies directly ahead!
Link
Don't think for a second that an eventual default of the US government on debt is not part of the plan. Default solves a large number of problems for the PTB in one fell swoop.
ReplyDeleteNo more will we owe anything to any foriegn creditors.
We also won't have social security anymore.
Now you understand why they want to move all the state pension funds into social security.
Then, when the default occurs, it's all gone.
And...it's gone.
George Carlin was right when he said they're coming for your pension funds. He knew their greed wouldn't stop at just social security and all other social programs (foodstamps, unemployment, welfare, and other thing you might think of to enable some sort of existence)
Things seem to be right on target. With the economic collapse timed with the fake Swine Flu pandemic, Americans will either die from the vaccine (don't take it, don't take it) or from starvation. What a lovely thought.
ReplyDeleteGIVE ME MY SQUALENE!