The
Federal Reserve Sends Thank You Letters To Congress For Letting Them Destroy
Our Economy In Secret
http://theeconomiccollapseblog.com
http://alberpeia.com/feddestroyingeconomy.htm
‘The Federal Reserve continues to pump up this "bubble
economy" by recklessly printing money and by setting interest rates
artificially low, and the U.S. Congress continues to stand aside and allow them
to systematically destroy our economy. The U.S. Congress could choose to
end this madness at any time, but the truth is that Congress won't even pass a
law that would allow the American people to see what is going on over at the
Federal Reserve. Congress has voted down every single bill that would
authorize a comprehensive audit of the Federal Reserve. So the folks over
at the Fed will continue to be able to destroy our future in secret. In
fact, back in July Federal Reserve Chairman Ben Bernanke actually sent five
thank you letters to members of Congress that gave speeches on the floor of the
U.S. House of Representatives encouraging their fellow lawmakers to vote
against the bill to audit the Fed. Since the U.S. Congress continues to
refuse to do anything to hold the Federal Reserve accountable, the Fed will
continue to print unprecedented amounts of money, it will continue to set
interest rates insanely low and it will continue to pump up the greatest debt
bubble in the history of the world. Unfortunately, all debt bubbles eventually
burst, and when this one does it is going to be a financial nightmare unlike
anything we have ever seen before.
It was Politico that first broke the story about the thank you
letters that Federal Reserve Chairman Ben Bernanke sent to five members of
Congress back in July. Bernanke acknowledged in the letters that there
was never any worry that the "Audit the Fed" bill would actually get
through Congress and be signed into law, but he was still extremely grateful
that a number of members of Congress got up and publicly denounced the bill....
In July, the Fed chairman sent letters
of gratitude to five Democratic members of Congress after they delivered
speeches on the House floor urging fellow lawmakers to reject the “Audit the
Fed” bill authored by retiring Texas Republican Ron Paul, the central bank’s
chief antagonist.
Their efforts failed to defeat the
bill, but they were not in vain, at least in Bernanke’s eyes.
“While the outcome of the vote was not
in doubt, your willingness to stand up for the independence of the Federal
Reserve is greatly appreciated,” Bernanke wrote in the letters, which were
obtained by POLITICO through a Freedom of Information Act request.
So who did Bernanke send those letters
to?
According to Politico, the thank you letters were delivered to U.S.
Representatives Barney Frank, Elijah Cummings, Melvin Watt, Carolyn Maloney and
Steny Hoyer.
By refusing to take action against the
Federal Reserve, the U.S. Congress is silently endorsing their incredibly
foolish policies.
Sadly, most Americans don't even
realize that the Federal Reserve has more control over our economy than anyone
else does. Most Americans that are actually concerned about politics are
busy arguing over whether Obama or Romney will be better for the economy when
it is actually the Fed that controls the levers of economic power.
Just think about it.
The Federal Reserve played a major role
in creating the housing bubble which severely damaged our financial system a
few years ago.
As the chart below shows, after 9/11
the Federal Reserve dropped interest rates to historically low levels.
This allowed potential home buyers to get into much larger mortgages, and the
big banks (which the Fed supposedly "regulates") started making home
loans to almost anyone with a pulse.
When interest rates started to go back
up to normal levels in 2005, many home owners discovered that their adjustable
rate mortgages started to become much more painful. By 2007, we started
to see a massive wave of mortgage defaults. In 2008, the financial system
crashed.
In response to the financial crisis of
2008, the Federal Reserve dropped interest rates to record low levels.
The effective federal funds rate is essentially at zero at this point, and the
Fed has promised to keep interest rates at ultra-low levels all of the way into
2015.
But didn't artificially low interest
rates cause many of our problems in the first place? The central planners
over at the Fed are convinced that this is the right course for our economy,
but can we really live in a zero interest rate bubble indefinitely? Won't
this eventually cause even greater problems?....
The Fed is also destroying our economy
by recklessly printing money.
Once upon a time, the U.S. monetary
base rose at a very steady pace. But since the financial crisis of 2008,
Ben Bernanke has been flooding the financial system with money and this has
caused an unprecedented explosion in our money supply.
It isn't too hard to see from this
chart what the foolish "quantitative easing" policies of the Federal
Reserve have done to our monetary base....
Fortunately a lot of the money from
previous rounds of quantitative easing is being stashed by the big banks as
"excess reserves" with the Federal Reserve, but when that money
starts flowing into the "real economy" (and it will at some point),
we are going to have a major problem on our hands.
But more than tripling our monetary
base was not enough for Bernanke. He recently announced yet another round
of quantitative easing which he says will last indefinitely.
Basically, Bernanke is taking a
sledgehammer to the U.S. dollar. Our currency is being systematically
destroyed, and the U.S. Congress is standing by and doing nothing.
For a lot more on why QE3 is going to
be so incredibly destructive for our economy, please see the following five
articles....
-"QE3:
Helicopter Ben Bernanke Unleashes An All-Out Attack On The U.S. Dollar"
-"QE4?
The Big Wall Street Banks Are Already Complaining That QE3 Is Not Enough"
-"Quantitative
Easing Did Not Work For The Weimar Republic Either"
The Federal Reserve seems to think that
printing more money is always the solution to whatever economic problems we are
having.
But of course the Fed has been debasing
our currency from the very beginning. The entire Federal Reserve system
is designed to create inflation.
From the time that the Federal Reserve
was created back in 1913, the purchasing power of a U.S. dollar has declined
from $1.00 to only about 4 pennies today.
And now Bernanke seems bound and
determined to wipe out those last 4 pennies.
The Federal Reserve system was also
designed to create a never ending spiral of government debt.
Sadly, most Americans simply have no
idea where money comes from. Most Americans
have no idea that money that the Federal Reserve zaps into existence out of thin
air is loaned to the U.S. government at interest. Most Americans have no
idea that the primary reason why we are 16 trillion dollars in debt is because
this is what the system was designed to do to us.
Today, the U.S. national debt is more than 5000 times larger than it was
when the Federal Reserve was originally created in 1913. This did not happen
by accident....
Not that our politicians should be off
the hook for this. They have been spending money as if there is no tomorrow. Most
of them have shown no concern at all about the legacy of debt that they are
passing on to future generations of Americans.
If our politicians had been more
responsible, the national debt would still be there, but it
would be at a much more manageable level.
If we ever want to totally get rid of
our national debt, the Federal Reserve must be abolished.
There is no other way.
And government debt is not the only
bubble that the Federal Reserve has pumped up.
The following is a chart that shows the
growth of all forms of debt (government, business, consumer, etc.) in the
United States. The total amount of debt in the United States has grown
from less than $2 trillion to more than $55 trillion over the past 40 years....
How in the world could we have been so
foolish?
How in the world did we allow the total
amount of debt in our country to get more than 27 times larger over the past 40
years?
As you can see, there was a slight
"hiccup" in the bubble as a result of the financial crisis of 2008,
but now it has started growing again.
At this point our entire financial
system is based on debt, and if the debt bubble does not continue to expand the
entire thing will collapse.
But no financial bubble grows
forever. History has proven that to us over and over.
At some point this bubble is going to
burst.
When it does, we will either experience
a deflationary collapse or a hyperinflationary collapse depending on how
"the powers that be" respond to what is happening.
History has shown us that financial
collapse is often accompanied by social upheaval. Many times it
even leads to war.
So what will happen to America when our
economic collapse happens?
That is a very good question.
How would you answer it?
