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#1 MikeyG

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Posted 11 December 2017 - 11:05 PM

The Fed is Ponzi scheme, after Nixon removed the gold standard in 1971, they can print without regard....

 

M1 is 4 Trillion backed by 500B in Gold....

 

 

 



#2 da_cheif

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Posted 11 December 2017 - 11:52 PM

The Fed is Ponzi scheme, after Nixon removed the gold standard in 1971, they can print without regard....

 

M1 is 4 Trillion backed by 500B in Gold....

 

 

 

>they can print without regard<       dont you love it?



#3 Douglas

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Posted 12 December 2017 - 03:14 AM

The FED is simply enabling raising taxes by using currency devaluation. Politicians have come to  realize that no one gets re-elected promising to raise taxes, so since abandoning the gold standard, the government is increasingly raising taxes by devaluation, getting all the money it wants to spend without actually voting to raise taxes, and it's loving it.  However, there are no free lunches.  The new tax bill includes $1.5 trillion in tax cuts which will be paid by printing money devaluing it, essentially taking that tax cut from savers and pensioners, literally robbing Peter to pay Paul.  If Paul would only  send a thank you note, Peter might feel a little better about being shafted.  The real trick, of course, is to shaft Peter slowly so he doesn't get mad enough to do something about it. 

 

This also goes a long way in explaining the bubbly stock market.  What is XOM worth in fiat that can simply be created out of thin air?  What PE is reasonable, infinity?  By this measure today's stock prices are a raging bargain.  95% of the stock gains since the early 1960's can be explained by currency devaluation.  Maybe the current super bubble is just Peter finally realizing what Paul has been doing to him all these years. 

 

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#4 gm_general

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Posted 12 December 2017 - 09:26 PM

I thought the only way the economy could have revved up recently is if the debt was being piled on at record rates. So I took a look at the Fed Flow of Funds report released this month, and sure enough, here it is. Over $1T of new debt added in 1 quarter alone. This is a rate not seen since 2007-2008 period.



#5 da_cheif

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Posted 12 December 2017 - 10:17 PM

thats hindsite....the market knew all this in advance starting in 09

 

The FED is simply enabling raising taxes by using currency devaluation. Politicians have come to  realize that no one gets re-elected promising to raise taxes, so since abandoning the gold standard, the government is increasingly raising taxes by devaluation, getting all the money it wants to spend without actually voting to raise taxes, and it's loving it.  However, there are no free lunches.  The new tax bill includes $1.5 trillion in tax cuts which will be paid by printing money devaluing it, essentially taking that tax cut from savers and pensioners, literally robbing Peter to pay Paul.  If Paul would only  send a thank you note, Peter might feel a little better about being shafted.  The real trick, of course, is to shaft Peter slowly so he doesn't get mad enough to do something about it. 

 

This also goes a long way in explaining the bubbly stock market.  What is XOM worth in fiat that can simply be created out of thin air?  What PE is reasonable, infinity?  By this measure today's stock prices are a raging bargain.  95% of the stock gains since the early 1960's can be explained by currency devaluation.  Maybe the current super bubble is just Peter finally realizing what Paul has been doing to him all these years. 

 

Regards,

Douglas



#6 Chilidawgz

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Posted 13 December 2017 - 03:17 PM

The Fed is Ponzi scheme, after Nixon removed the gold standard in 1971, they can print without regard....

 

M1 is 4 Trillion backed by 500B in Gold....

 

 

 

A thought from Lance Roberts:

 

the central bankers have clearly crossed the line between free markets and government controlled markets. To answer your question about the “shakeout,” we must wait until the inevitable day comes and asset prices are in free-fall. When this occurs, we will learn the full extent of their support and how far they have crossed the line. We like to think the central bankers are willing to endure the short-term pain of such a situation and allow the natural cycle of economies and asset prices to run their course. The reality, however, is that the pattern of their actions in the post-financial crisis era argue that they are unlikely to relinquish their grip. To the extent that authority and power is extended to the Fed through the U.S. Congress, it does not seem likely for career politicians to urge action that may be painful in the short-term but highly beneficial in the long-term.

This premonition was supported by recent statements from the October 2017 Federal Reserve minutes and appointed Fed Chairman Jerome Powell respectively. Fed Minutes:

“In light of elevated asset valuations and low financial market volatility, several participants expressed concerns about a potential buildup of financial imbalances,” further “They worried that a sharp reversal in asset prices could have damaging effects on the economy.” Jerome Powellin prepared remarks to Congress stated: “(the Fed) will respond with force to threats to the nation’s stability.”

Putting two and two together, one can quickly figure out that falling asset prices and the “damaging effects” they will inflict on the economy will not be tolerated by the Fed.


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#7 NAV

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Posted 13 December 2017 - 11:56 PM

 

 

Jerome Powellin prepared remarks to Congress stated: “(the Fed) will respond with force to threats to the nation’s stability.”

 

Instability being defined as every 1% decline in the market ! tongue.png


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