Waiting to see...
The market has already priced in the expected .5% interest drop from the Federal Reserve. Bernanke's panic already reduced it another .75%. Is it the insolvency of the banks that causes him think to panic? Can they continue this shell game of hiding insolvency any longer? So, I ask you, what tricks do they have up their sleeves to keep this system in balance.
I think the economy is much like a oscillator. If you do not adjust the components, you can reach a steady state. The Fed is like a big capacitor on the circuit. The Fed can make big adjustments in the frequency of the market by adding or removing money. This is similar to the change in an LC tank where you can add or change the capacitance of the LC tank circuit to change the oscillation of the circuit.
This oscillator consists of a capacitor (the Fed's control of the money supply) and a coil (The economy) connected in parallel. Suppose a capacitor(the Fed) is given the permission to give money. Once the the Fed has that right, one part of the Fed has more money than the other banks, thus it is charged.
Now, when it is the money supply is increased through the economy, the money goes to the people, thus making the balancing the Fed against the people, or discharged. However, this action works differently when you discharge the money supply through the economy. When money is applied through a economy, goods and services are generated around the economy. This economy generates a money multiplier across the economy that opposes the volume of money flow.
Because of this, the Fed does not effect the money supply right away. The smaller the economy,
the faster the money goes into people's pockets. Now the interesting part happens. Once the Fed is fully committed through the economy, the economy starts to collapse.
The change in economic potential induced from the collapsing economy adds money back into the Fed. Then the Fed begins to send the money back thorugh the economy again, generating goods and services. This process continues until the Fed is completely discharged due to currency collapse.
Technically this basic circuit generates the business cycle that loses money in every cycle. To overcome this, additional money is applied to keep the economy from losing money. However, to keep this oscillator going well, they need to leave it alone.
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4 comments:
How about this, 1+1=2. So a silver dollar should cost 1 FRN, if it does not then our monetary system is FRUAD!!!
THe PPI and CPI and jobs numbers are bolgny. We are in a deppression, believe it or not. I read about this along time ago that the wealthy would take a larger percentage of the wealth so that 1% can consume more goods while the remaining 99% would see a sharp decline in the cost of living. We are in a depression, you do not loose 2 million homes in a recession.
I was a court evicting someone and the bailif said we do not get many eviction cases because the BAnks own all of the home and they are vacant.
"When we let Banker issue or currency first they wil hit us with inflation(house bubble) then deflation (housing crash) and we will all become homeless on the LAnd that our Fathers counquered" Thomas Jefferson
So stop trying to figure this out and welcome to the NWO!
John,Keep up the great work,I am looking forward to your commentary on Bushs "State of the Union"..will it soon be the "state of the North American Union"??.
It would be great if you could give us your take on the yen and the unwinding of the carry trade.
Thanks again John ,your time & intelligence is very much appreciated,
What do u think about what is happening to gold just at the moment...i certainly agrree with you about the retraction of the monetry supply,,,i think we are heading into world wide rate cut "wars" with massive inflation of essentials,deval of luxeries & very little liquidity in the market.But i am tryying to factor in the chinese dumping those dollars back here and buying up...how do you factor that into the equation John.
You think Chopper Ben will cut rates .5% again John?that would be a sure sign of economic suicide and confidence breaking..any links to the reason why John?
may be a new plan from Bush and Ben..Everyone is a winner lotteries..or why not just send the printing presses to china send the flat screens straight here ,sure would save time and trouble.
although soon the chinese will start sending those shitty notes back here.May be we should all shift to China(the whole nation except the globalists of course),the chinese and the Arabs can relocate here since they are going end up owning us and we start again in China with a new Constitution with a few more ammendments..such as those that want war have to be in the front lines with their families..
Anyway thanks John you are very much appreciated,I think your vids linked to youtube give you more exposure rather than the small player and some colour to your blog..just a suggestion.
Thanks
My brother has been laid off. He cannot find another decent job because every position has 50 applicants. He lives in florida. He worked in a job supporting the housing boom. He is behind on his house payment and using his credit card to buy gas for his car. Multiply this a million times or more and you have a big problem coming down the tubes when these people tap out and default first on their credit cards and finally on their homes. More bad times ahead.
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