The April Emergency The Federal Reserve Doesn't Want You To Know About

Using "expedited procedures" the Federal Reserve Board of Governors held an impromptu (read emergency) meeting yesterday to discuss monetary policy and interest rates. Afterwards Chairwoman Yellen visited the White House for another irregular meeting with the President. Both of these meetings were closed door and both went largely unreported by the mainstream media. Unfortunately we don't know exactly what was said in those meetings, but we do know it is highly unusual for the Fed to invoke "expedited procedures." More in the video below:

[video=youtube;Ne4YJYLm62g]https://www.youtube.com/watch?v=Ne4YJYLm62g&feature=youtu.be[/video]


But ignore all this ok. Obama said the economy is doing great and the recovery is great, so that's all you need to know.

 

Fed discusses monetary policy and interest rates. The stuff of nightmares.

 

Time for a stock market crash, I guess. The bubble's going to pop. Well, that was predicted as going to happen for a while now.

I wish I had insider info. Generally I'm a proponent of low interest rates, but I would be open to hearing about a better way in a crisis.

And low GDP rates it's recession time. Well, this is just part of our market system.

And negative manufacturing because no one is buying stuff. Well it's the cost of living stupid. We need to lower costs which means getting rid of those hidden taxes that cause manufacturers to raise the price of goods. We can't raise the minimum wage that can't work. Time to uproot the back-end, supply-side instead.

 

Thank you for getting this information out! It is also interesting that the Fed's partner in crime, the International Monetary Fund, has been putting out one scary message after another since the first of the year. The most recent warning came just yesterday... take a look at the IMF's Christine Lagarde's verbal droppings:
http://www.bdlive.co.za/world/europe/2016/04/06/lagarde-warns-imf-will-cut-global-forecasts
http://www.ibtimes.com/imf-likely-trim-2016-global-growth-forecast-headwinds-persist-2352174
http://www.politico.eu/article/christine-lagarde-doubts-progress-with-greece-possible/

Oh, but there's one bright side for the world's economy, according to Lagarde! Negative interest rates! Sure -- people who actually save money need to be punished even more than they have been for almost the last eight (*)(*)(*)(*)ing years. Now the central bankers want to fix it so that you, the saver, don't get any interest on your deposits at all -- and -- you get to pay those bastards for the "privilege" of letting them keep your money on their books. The banks already make a fortune by getting money from the big central banks, like the Fed, the European Central Bank, etc. The little banks belly-up to the "discount window" and get all the money they can qualify for and then churn it out to eager borrowers, making a huge profit -- for doing NOTHING.

The demand for money is there! People are desperate for credit, and interest rates should rise accordingly, with depositors getting a fair interest rate on their deposits. BUT, the Federal Reserve and the other big central banks have gained almost total control over every economy in the world since the "Great Recession" by artificially manipulating interest rates, and they aren't ever going to give up that power again....

 

If you are really that interested, you can go back to January in my posting history when I pointed out that the next time the fed would meet to discuss interest rates would be April. When you are done, look at the calendar on your computer and see what month it is. This "emergency meeting" sure does sound like a work session for their regularly scheduled meeting to me.

 

I disagree! Demand for money is not there. Or, at least the ones who actually have demand for money are not credit worthy or don't feel like borrowing -- because they are tapped out from decades of living above their means, fueled by debt taking.

What we have is the endgame of a decades-long economic expansion fueled purely by private debt. Now, the creditors are running out of debtors. Thus, they are searching for return for the vast amount of money sloshing around at the top, which is going into stock market speculation, rather than actual investing.

The Fed is unable to set the interest rate different from the rate demanded by the market for prolonged periods of time. The market demands 0 or negative interest rates, because there are lots of creditors with large sums of money to lend, but no new debtors. Thus, supply and demand predict that interest rates will be low -- large supply of credit, low demand for it. And that's exactly what we see, no shenanigans of the Fed or Obama required.

Overall this is actually a result of the ever increasing wealth inequality. When too few people control too much of the wealth, the market eventually comes to a halt -- because the majority is priced out of participating in the market.

The macroeconomic solution: Get more money into the hands of the consumers rather than the hoarders at the top.

 

Something's gotta give, that's for sure, or we'll wind up like Venezuela. Trump has the best solution. Make better trade deals in the interest of the U.S. and secure the border.
Free trade is nice to get cheap stuff from China, but it doesn't lower the price of housing and cars, does it? Or utility costs.
Democrats artificially inflating wages will simply cause prices to go up more, as it did in the 70's.
What does Cruz offer? Nothing. He talks about being more 'conservative', but what does that mean? Cut social benefits without sealing the border or cutting better trade deals? What good will that do?

 

April 19th 2016

 

I can agree with your observation that, finally, many people who are not credit-worthy are no longer the danger to the stability of the economy they were prior to the 2007 "Great Recession". As we all know by now, the titanic housing "bubble" was brought on largely by liberal Democrats in Congress who got the bright idea that everybody should run right out and buy a house -- whether they could actually pay for it or not!

Things leveled out after a modest shakeout, and the bottom-feeders were allowed to go ahead and hit the bottom and foreclosures soared. And, there was way too much "rescue" and way too much more of the "too big to fail" nonsense that made multi-millionaires out of criminal investment bankers who should have been sent to prison or at least made bankrupt, but the Fed managed to pull off a "rabbit-in-hat" trick by gushing out warehouses full of essentially worthless new money, and squashing interest rates down to almost zero.

BUT. In order for this gigantic fraud-balloon to go floating merrily along, the Fed needs to engineer, somehow, some way, a real growth rate of at least 2%, and to put it mildly, that is NOT the trajectory our economy is on now.

Again, I point out that in addition to all this roiling activity in the Federal Reserve combine right now, we need to pay attention to the International Monetary Fund (IMF). While this mummery has been going on with Yellen and Obama, look what's going on in the IMF in just the last six months, and even more recently than that:
http://triblive.com/business/headli...n=Feed:+tribunereviewbusiness+(Business+News)
http://www.theguardian.com/business...crisis-global-stability-report-eurozone-banks
http://www.theweek.co.uk/eu-referendum/63710/eu-referendum-imf-issues-stark-brexit-warning
http://www.globalresearch.ca/imf-warns-of-slow-growth-and-economic-shocks-in-2016/5498690

I'll leave the science of reading economic "tea-leaves" along with graphs and charts to experts like Mike Maloney. I'll be more blunt: we're unlikely to anchor real growth and prosperity in a free-market economy where so many people don't DO anything!

Approximately 50% of the American public are drawing some form of welfare-suck and/or "subsidies" from the government. Labor force participation is the lowest it's been since the mid-1970's. The Middle Class continues to shrink because even though there's more "jobs" now than five years ago, they're mostly just crap jobs and part-time gigs that don't pay anything or feature any real benefits -- except for government jobs, which are today about the best that most people can hope to get. And, the squeeze is on -- because the price of nearly everything that people actually buy and need has shot upward in the past three years, but wages are flat. Rent is way up, groceries have shot upward, housing prices have skyrocketed (again), and the only place where prices have decreased is in fuel. The REAL unemployment rate, in spite of all this, is shown in the Department of Labor's report called the "U6": http://www.bls.gov/news.release/empsit.t15.htm . The U6 changes month-to-month, and is currently at 9.8% (the old U3 report is also shown at the site, and the Obama admn. uses it because it shows lower unemployment, but the U6 is much more reflective of conditions in today's real world. Thus, the pent-up demand for money and for credit is very strong indeed. Credit card debt has been steadily increasing in recent years and people are not paying off the balances. In February, the average credit card debt was $5,700, but most Americans don't even have $1,000 in savings: http://www.marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06 .

I could go on and on, but I'll close by saying that I DON'T think that all this means that we should run out and buy lots of gold and silver. Been there, and done that, back in the late 1970's, and I learned one big lesson the hard way: the Federal Reserve controls this economy -- lock, stock, and barrel. Janet Yellen may pose for a White House visit with whatever handpuppet we have in there as the "president", but that doesn't mean squat! Idiot Bush was a Fed stooge, and Idiot Obama is, if anything, even more of a house-pet and stooge than "W" was. Bottom line: the Fed may "print" more money, impose negative interest rates, cause a shake-out periodically, topple governments, or anything else it needs to do to increase and consolidate its POWER over all economies in the world.

Right now the only force I know of that can set this global banking hegemony back is the Russian Federation. Vladimir Putin, good and bad, right and wrong, has the education, the intelligence, the experience, and the power to do what he envisions as being best or Russia, and that probably won't be what's good for a gaggle of central bankers in "the West"....

. "Me? I'm just 'homefolks' from St. Pete, with a Ph. D in Economics, a Law Degree, and Forbes' 'World's Most Powerful Leader' award for the past three years...."

 

Since at least 2009.

The cost of living has gone up because middle class incomes have not.

The richest are doing great though. Virtually all the real economic growth has gone to them since the Reagan "trickle down" revolution.

Let's elect a Republican and give them another huge tax cut. That'll help the situation.

 

OK, I'll bite. What's April 19th?

 

Don't have time to respond to your whole post. Two things:

1) Yes, the real unemployment rate is higher than the admin wants us to believe. Yes, this is not good for the economy. I think we disagree about the causes: I think that the high unemployment is not caused by people being too lazy to work. I rather think that it is because of a lack of opportunity. Why else would it take record numbers of resumes sent to even get an interview? Or record number of applicants for every open position? The market dynamics are not hard to read: The employers hold all the cards. That's why the can control low wages at will. It's what supply side economics was designed to do: Put the ball into the supply side court. They are, however, not delivering.

2) I don't understand why you think demand for credit is high? With all those people out of the labor force, they are surely not looking for credit, or they are not credit worthy. So, where should that demand come from? From the top few %? No, they are the ones who want to lend the money, they don't want to borrow it.

 

This could be a reference to this story: http://allnewspipeline.com/April_19th_Weeks_Away_From_Economic_Armageddon.php

While I'm not happy with anything that's been going on in the economy since the central banks of the world took over nearly all economies everywhere, I don't see anything to really panic over -- yet.

Still, it is true that the Federal Reserve has been conducting some unusual meetings lately, and the timing of these meetings is strange, too. Couple that with all the dire warnings coming out of the International Monetary Fund for about the last six months and you do have something of a puzzle.

For your perusal (some are blogs, and the last three focus on the IMF):
http://finance.yahoo.com/news/obama-feds-yellen-discussed-economic-204346233.html
https://www.dollarvigilante.com/blo...mergency-meetings-crises-erupt-worldwide.html
http://beforeitsnews.com/self-suffi...-discussions-for-banking-failure-2503055.html
http://www.wsj.com/articles/imfs-gloomy-warnings-miss-good-news-on-global-economy-1460579236
http://www.thedailyeconomist.com/2016/04/imf-downgrades-entire-global-economy.html
http://www.thedailyeconomist.com/2016/04/imf-downgrades-entire-global-economy.html

As you know, I disapprove greatly about nearly everything the Fed and all the other central banks in this wanna-be, planet-wide hegemony do nearly every day. The IMF is merely another one of the central bankers' power-projection tools, mainly focusing its manipulative strategies since the fall of the old Soviet Union on Eastern Europe. Too bad for the central banksters and the IMF that they're pitted against Vladimir Putin....

. "Wanna talk economics, Madame Lagarde? Cool. I've also got a Ph.D in Economics...."

 

Time for a gutting and a culling.

 

Lol. It's insane isn't it?

But there's something else. It is about control, but they can't raise rates because of the size of the national debt. If they raised rates to 1978 or 1978 levels right now, it would absorb ALL tax revenue just for interest on the national debt. And even minor rate increases would increase the deficit dramatically. That's why the system is ultimately doomed. Pick your poison, destruction by negative interest rates or destruction by defaulting on the national debt. And you still have threats of massive deflation, hyperinflation, or a combination of both in different areas of the economy.

But again, we should just ignore all that and just keep believing that Obama is making things better according to the mainstream media...

 

We're going to have a crisis, regardless. And I expect it to start with defaults by some of the big banks in Europe, leading to a derivatives meltdown. Deutsche Bank looks poised to go first:

Deutsche Bank is Crashing Again as European Banks Slide to Crisis Lows
http://www.zerohedge.com/node/528284

Remember, we were only 3 hours away from a total meltdown in 2008. Start watching at 2:09 in this video for an inside view of what Congress was being told:

[video=youtube;pD8viQ_DhS4]https://www.youtube.com/watch?v=pD8viQ_DhS4[/video]

I personally think a complete collapse is what we need. If all accounts go to zero, then all debts would be wiped out as well. We need that for a fresh start. If the government would be honest with people and tell them to prepare then it could be a good thing. But of course all they and the banksters want to do is maintain their power structure in the status quo.

 

Nothing you say after that is worth reading. For in early 2000s, it was all bush and all R's in control and his speech about every American in their own home.
So, no credibility left.

 

When they cut interest to 0 we all knew that the stoke market would surge and in the end there would be a crash when the interest rates are allowed to return to normal.

Banks pay almost nothing to barrow money and on savings but charge 14% on short term loans. Credit cards still charge 19% and the banks that all politicians pretend to hate are making record profits.

 

You better check your own credibility:

The Clinton-Era Roots of the Financial Crisis

"There's a strong case that the answers can be traced to Sept. 12, 1992. On that day presidential candidate Bill Clinton proposed, in his campaign book "Putting People First," using private pension funds to "invest" in government priorities, such as affordable housing, to "generate long-term, broad based economic benefits." Seldom has such a radical proposal been so ignored during a campaign only to later lead to such devastating consequences."

 

It's Clinton's fault?

[video=youtube;hDou01X5d28]https://www.youtube.com/watch?v=hDou01X5d28[/video]

 

OK, I did.

This administration will constantly strive to promote an ownership society in America. We want more people owning their own home. It is in our national interest that more people own their own home. After all, if you own your own home, you have a vital stake in the future of our country. And this is a good time for the American homeowner. Today we received a report that showed that new home construction last month reached its highest level in nearly 20 years. (Applause.)

The reason that is so is because there is renewed confidence in our economy. Low interest rates help. They have made owning a home more affordable, for those who refinance and for those who buy a home for the first time. Rising home values have added more than $2.5 trillion to the assets of the American family since the start of 2001.

The rate of homeownership in America now stands a record high of 68.4 percent. Yet there is room for improvement. The rate of homeownership amongst minorities is below 50 percent. And that's not right, and this country needs to do something about it. We need to -- (applause.) We need to close the minority homeownership gap in America so more citizens have the satisfaction and mobility that comes from owning your own home, from owning a piece of the future of America.

http://georgewbush-whitehouse.archives.gov/news/releases/2003/12/20031216-9.html

If the problem started in 1992, then fuel was added to the fire in 2003.

 

at the point where we are at right now i think massive debt relief is the only chance. Putting money into the hands of consumers doesnt work anymore because they give it immediatly back to the banks to pay for debt and it barely makes a dent.

 

Blaming Clinton is the height of partisanship. There was no housing bubble when Clinton was president.

The Republicans controlled the White House, the Senate, the House, and a majority in the Supreme Court during the entire time the housing bubble grew to its absurd heights and then started to crash.



But even though the Republicans controlled the entire government during the entire bubble, and their president constantly promoted policies expanding home ownership, they'll blame Clinton, and Carter, and blacks and Obama and Frank and any other Democrat rather than manning up to their own responsibility.

And in the next post point the finger at Democrats accusing them of "blaming Bush" if we point out the disasterous state of the economy he left.

 

The tide of economic flow has turned.
Deflation due to lower energy costs has created a period of personal saving to pay down debt.
I just witnessed a drop in tire prices that was about 20% across the board. All companies from Pirelli to Goodyear to BF Goodrich.
There have been other indicators, like the price of steel. This will ripple throughout the economy in a deflationary spiral that might cause the uninformed to panic. A monetary deflationary spiral would be bad, but a source materials deflation due to cheap energy is exactly what drove the industrial revolution to greater and greater heights.
There will be a period just after the current election cycle that must be controlled by a steady hand.
Real personal incomes are actually rising at this very moment. And will continue to do so as long as oil prices stay steady. I believe this will happen for the next 10 years.
The reduction in real prices to the consumer will not create a problem for corporate bottom lines, while wages probably will rise in the near term. WITHOUT the need for government intervention.
Case in point is Walmart.
If you got Obamacare off their back, they would convert as many people as possible to full time. But because they have to deal with that mandate, they absolutely have to keep workers below 32 hours a week to keep expenses in check.
But of course that was Obama's intention.

 

At least money would still be cycling through he economy, even if consumers spend it all immediately. Better than all sitting in the banks not being lent.