The Great Contraction - Part 2: Frankenstein's Economy
Don't worry, I'm gonna go over parts of these charts individually in separate posts and explain what the heck is going.
I'm running low on time today, but hopefully this overview gives you a good idea of my stance.
The first Bretton Woods established the dollar as the GRC to allow for balance sheet expansion to finance a post-war global economy that was eager to grow rapidly. Dollars flooded the world, but so much that the gold backing was holding it back. During this period, the global banking system had developed their own "money" in the form of financial instruments to help get around this. In the late 60s policy makers realized this problem and in '71 the next Bretton Woods debased the currency. The problem, though, was that this "shadow" banking system had already grown into something organically complex and the policy makers had (and continue to have) essentially no clue how it works. So they basically just left "money" undefined and took the approach of their economic predecessors and adopted an expectation-based monetary system.
Yup, this is why you have the Federal Reserve Chairman, Mr. JPow, going on 60 minutes and blatantly lying to the world. Because that's just how bad things are. Big. Bigger. Biggest. None of this "QE" is easing the system because they simply don't understand it. A massive crack formed in the global monetary system on August 7th, 2007, and ever since then we've seen leaks in the form of market crashes and global recessions. What happened in March of this year was the crack wedging itself open and after 13 years it's finally ready to burst.
If you thought things have felt "weird" for a while now, that's because they were. This federal "stimulus" has done nothing more than allow Reaganomics to get stuck at the top, causing this absurd consolidation of wealth and failing middle class. And we've had it best in the world here in America because of the dollar shortage.
In the next economic-based sections, probably starting around Part 5ish, I'll go over the mechanics of this colossal bubble (i.e. Eurodollar, Petradollar, Credit, Rehypothication, Offshore Repos, etc.)
Finally posting some actual chart analysis in a little here, I swear.
I'm running low on time today, but hopefully this overview gives you a good idea of my stance.
The first Bretton Woods established the dollar as the GRC to allow for balance sheet expansion to finance a post-war global economy that was eager to grow rapidly. Dollars flooded the world, but so much that the gold backing was holding it back. During this period, the global banking system had developed their own "money" in the form of financial instruments to help get around this. In the late 60s policy makers realized this problem and in '71 the next Bretton Woods debased the currency. The problem, though, was that this "shadow" banking system had already grown into something organically complex and the policy makers had (and continue to have) essentially no clue how it works. So they basically just left "money" undefined and took the approach of their economic predecessors and adopted an expectation-based monetary system.
Yup, this is why you have the Federal Reserve Chairman, Mr. JPow, going on 60 minutes and blatantly lying to the world. Because that's just how bad things are. Big. Bigger. Biggest. None of this "QE" is easing the system because they simply don't understand it. A massive crack formed in the global monetary system on August 7th, 2007, and ever since then we've seen leaks in the form of market crashes and global recessions. What happened in March of this year was the crack wedging itself open and after 13 years it's finally ready to burst.
If you thought things have felt "weird" for a while now, that's because they were. This federal "stimulus" has done nothing more than allow Reaganomics to get stuck at the top, causing this absurd consolidation of wealth and failing middle class. And we've had it best in the world here in America because of the dollar shortage.
In the next economic-based sections, probably starting around Part 5ish, I'll go over the mechanics of this colossal bubble (i.e. Eurodollar, Petradollar, Credit, Rehypothication, Offshore Repos, etc.)
Finally posting some actual chart analysis in a little here, I swear.
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