The Beginning Of The End
The Beginning Of The End By Michael T. Snyder - Kindle Version

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The Mystery Of The Shemitah

Farewell Bernanke – Thanks For Inflating The Biggest Bond Bubble The World Has Ever Seen

Barack Obama And Ben BernankeFederal Reserve Chairman Ben Bernanke is on the way out the door, but the consequences of the bond bubble that he has helped to create will stay with us for a very, very long time.  During Bernanke's tenure, interest rates on U.S. Treasuries have fallen to record lows.  This has enabled the U.S. government to pile up an extraordinary amount of debt.  During his tenure we have also seen mortgage rates fall to record lows.  All of this has helped to spur economic activity in the short-term, but what happens when interest rates start going back to normal?  If the average rate of interest on U.S. government debt rises to just 6 percent, the U.S. government will suddenly be paying out a trillion dollars a year just in interest on the national debt.  And remember, there have been times in the past when the average rate of interest on U.S. government debt has been much higher than that.  In addition, when the U.S. government starts having to pay more to borrow money so will everyone else.  What will that do to home sales and car sales?  And of course we all remember what happened to adjustable rate mortgages when interest rates started to rise just prior to the last recession.  We have gotten ourselves into a position where the U.S. economy simply cannot afford for interest rates to go up.  We have become addicted to the cheap money made available by a grossly distorted financial system, and we have Ben Bernanke to thank for that.  The Federal Reserve is at the very heart of the economic problems that we are facing in America, and this time is certainly no exception.

This week Barack Obama publicly praised Ben Bernanke and stated that Bernanke has "already stayed a lot longer than he wanted" as Chairman of the Federal Reserve.  Bernanke's term ends on January 31st, but many observers believe that he could leave even sooner than that.  Bernanke appears to be tired of the job and eager to move on.

So who would replace him?  Well, the mainstream media is making it sound like the appointment of Janet Yellen is already a forgone conclusion.  She would be the first woman ever to chair the Federal Reserve, and her philosophy is that a little bit of inflation is good for an economy.  It seems likely that she would continue to take us down the path that Bernanke has taken us.

But is it a fundamentally sound path?  Keeping interest rates pressed to the floor and wildly printing money may be producing some positive results in the short-term, but the crazy bubble that this is creating will burst at some point.  In fact, the director of financial stability for the Bank of England, Andy Haldane, recently admitted that the central bankers have "intentionally blown the biggest government bond bubble in history" and he warned about what might happen once it ends...

"If I were to single out what for me would be biggest risk to global financial stability right now it would be a disorderly reversion in the yields of government bonds globally." he said. There had been "shades of that" in recent weeks as government bond yields have edged higher amid talk that central banks, particularly the US Federal Reserve, will start to reduce its stimulus.

"Let's be clear. We've intentionally blown the biggest government bond bubble in history," Haldane said. "We need to be vigilant to the consequences of that bubble deflating more quickly than [we] might otherwise have wanted."

Posted below is a chart that demonstrates how interest rates on 10-year U.S. Treasury bonds have fallen over the last several decades.  This has helped to fuel the false prosperity that we have been enjoying, but there is no way that the U.S. government should have been able to borrow money so cheaply.  This bubble that we are living in now is setting the stage for a very, very painful adjustment...

Interest Rate On 10 Year U.S. Treasuries

So what will that "adjustment" look like?

The following analysis is from a recent article by Wolf Richter...

Ten-year Treasury notes have been kicked down from their historic pedestal last July when some poor souls, blinded by the Fed’s halo of omnipotence and benevolence, bought them at a minuscule yield of 1.3%. For them, it’s been an ice-cold shower ever since. As Treasuries dropped, yields meandered upward in fits and starts. After a five-week jump from 1.88% in early May, they hit 2.29% on Tuesday last week – they’ve retreated to 2.19% since then. Now investors are wondering out loud what would happen if ten-year Treasury yields were to return to more normal levels of 4% or even 5%, dragging other long-term interest rates with them. They know what would happen: carnage!

And according to Richter, there are already signs that the bond bubble is beginning to burst...

Wholesale dumping of Treasuries by exasperated foreigners has already commenced. Private foreigners dumped $30.8 billion in Treasuries in April, an all-time record. Official holders got rid of $23.7 billion in long-term Treasury debt, the highest since November 2008, and $30.1 billion in short-term debt. Sell, sell, sell!

Bond fund redemptions spoke of fear and loathing: in the week ended June 12, investors yanked $14.5 billion out of Treasury bond funds, the second highest ever, beating the prior second-highest-ever outflow of $12.5 billion of the week before. They were inferior only to the October 2008 massacre as chaos descended upon financial markets. $27 billion in two weeks!

In lockstep, average 30-year fixed-rate mortgage rates jumped from 3.59% in early May to 4.15% last week. The mortgage refinancing bubble, by which banks have creamed off billions in fees, is imploding – the index has plunged 36% since early May.

If interest rates start to climb significantly, that will have a dramatic affect on economic activity in the United States.

And we have seen this pattern before.

As Robert Wenzel noted in a recent article on the Economic Policy Journal, we saw interest rates rise suddenly just prior to the October 1987 stock market crash, and we also saw them rise substantially prior to the financial crisis of 2008...

As Federal Reserve chairman Paul Volcker left the Fed chairmanship in August 1987, the interest rate on the 10 year note climbed from 8.2% to 9.2% between June 1987 and September 1987. This was followed, of course by the October 1987 stock market crash.

As Federal Reserve chairman Alan Greenspan left the Fed chairmanship at the end of January 2006, the interest rate on the 10 year note climbed from 4.35% to 4.65%. It then climbed above 5%.

So keep a close eye on interest rates in the months ahead.  If they start to rise significantly, that will be a red flag.

And it makes perfect sense why Bernanke is looking to hand over the reins of the Fed at this point.  He can probably sense the carnage that is coming and he wants to get out of Dodge while he still can.

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  • Rodster

    The Rats fleeing the sinking ship.

  • K

    So Bernanke feels he has been around too long, first thing I ever agreed with him on. I believe the term rats abandoning a sinking ship, would be appropriate here

  • condaggitt

    just wondering has anyone seen their credit card rates drop…..i thought so

  • Hope

    The Bible says that the “the authorities that exist are appointed by God.” Therefore, God has allowed President Obama and Mr. Bernanke in office to bring your country to its knees. I’m from Canada, and we will follow suite too, just like all other Western Nations.

    Money isn’t going to save you–God can if you turn to Him. Instead people just keep running the other direction in pursuit of mindless and trivial things.

    • Tim

      Good points, hope. God humbled Nebuchadnezzar the king of Babylon by putting him out to pasture to eat grass like an ox for 7 years! After Nebuchadnezzar came to his senses, he said that the most High sets up the basest (vilest) of men to rule over the kingdoms of this world! (Daniel 4:17)

      • Boo-urns

        Fiction, pure fiction. Amazing (and so very sad) that a modern 21st century human would not only believe but actually base their entire life around a fable from another millennium.

    • Boo-urns

      BS.

    • K

      Mostly agree with your post. However the verse you quote, has often been misused in the past. It has been used to demand obedience to evil leaders. I hope that is not your intention. Example the U.S. is currently supporting the rebels in Syria. These people have murdered many Christians and burned their Churches. They have beheaded children, and eaten the hearts of their enemies. I believe their is nothing in the Bible, which forbids me to loudly object to that.

      • Tim

        The apostles and the early church lived under a government that was far more wicked than our own–the Roman government. Yet Paul admonished the Christians at Rome to be subject to the higher powers. The only time a Christian has the right to disobey those in authority is if they command something that is contrary to the Word of God. (Acts 5:29)

        Now, I am opposed to all the wars that the U.S. government has started in the Middle and Far East. Furthermore, it is reprehensible that our government would support something that they claim to have been fighting for so long through the so-called War on Terror. This is one reason that I do not vote. Our leaders, most of whom are God’s enemies, will answer for their wicked deeds on the Day of Judgment. They are storing up wrath against the day of wrath, and their damnation will be just.

        As a Christian, my duty is to live in obedience to God’s Word. There is much suffering and injustice in this world, and it’s all because of sin. God sees everything that happens to His own, including those Christians in Syria who have been martyred. It’s nothing new. God’s people have been martyred since the beginning of time. Abel was murdered by his brother. God is sovereign, and He will mete out perfect justice in His time.

        • K

          Tim, sorry I think you are confusing support with obey. I do not disobey the laws of my Country. But when my Country sides with evil, I will object. In the old days did God not send prophets to evil leaders to warn them of their sin? How is objecting to evil acts any different? By your understanding this Country was born by committing a great sin. We not only disobeyed the leaders of that time, we committed an act of armed rebellion. Do you believe this Country was damned from the beginning?

          • Tim

            I think you misunderstood my comment. I clearly stated that I am opposed to the wicked deeds of our government. And I do voice my opposition.

            If the U.S. government ever commands you to do something contrary to the Word of God then it’s your duty to disobey . For example, if our government were to issue an edict that all male children are to be aborted, I would most certainly disobey.

          • K

            Sorry if I misunderstood.

        • JohnCampbell

          I highly doubt that the Roman government was far more wicked than our own. I think it’s the other way around

          You are correct in saying that we are also commanded to disobey those in authority is if they command something that is contrary to the Word of God.

          So for example if they want to draft to you to an unjust war it’s your duty as a Christian not to go.

    • Barn Cat

      God has allowed evil men to rule the country because the country is evil. God’s wrath is going to be poured out on America because America has murdered 50 million unborn babies.

      • Gay Veteran

        and how many unwanted babies have YOU adopted?

        • cherylmeril

          That’s not the point of this discussion.

          • Gay Veteran

            ah, but cherymeril it was YOU who brought up abortion.
            so again, how many unwanted babies have YOU adopted?

          • cherylmeril

            I was unaware of any law claiming I must adopt children, which one are you citing?

          • Gay Veteran

            oic, you just want to enslave women and force them to give birth. How nice of you since you will not suffer any negative consequences of the actions you FORCE others to take.
            btw, you cannot be free if you do not control your own body (Karl Denninger, one of the founders of the Tea Party movement)

          • drmom5

            They won’t even agree to help feed or educate them!

      • cherylmeril

        BarnCat, not exactly. Even if America as a nation repented of the abortion and other sins, the Lord would forgive and not pour out his wrath. Repentance is key to reversing God’s wrath, however that’s obviously not happening so there you go.

      • Boo-urns

        U. R. Nuts.

      • JohnCampbell

        Burn Cat: America has done more evil than that This country has been involved in directly (or covertly) starting almost all the wars in the last 100+ years. Including both WW1 and WW2. (No, Hitler wasn’t really responsible for WW2 if you really knew true history as opposed to the official WW2 lie)

        And continues doing it to this day. Right now working on destroying Syria. Iran, North Korea, Russia and China will be next. It’s all based on pure lies..There is nothing noble or righteous about these wars. It’s all unjustified aggression and it’s all done for the benefit of our Zionist/Israeli masters and their centuries old plan for world domination conquest.

    • markthetruth

      we went through this already . .Jesus said it’s easier for a camel to fit through the eye of a needle than it is for a rich man to enter heaven.

      the end…

      • cherylmeril

        You kind of take that out of context from the entirety of what Jesus was saying.

  • rat28

    I believe many of you will not have internet access if Bernanke has not stepped in with this extraordinary massive money printing since the crash of 2008. You guys should be grateful for his service instead of criticizing him.

    • GSOB

      will not or would not?

    • Ayn Rand

      What? He helped us? How? Please explain rat.

    • chilller

      Yet another short sighted kool-aid drinker…

      I don’t know of a single parent who wouldn’t take a bullet for their children and Benny has cut loose at them with nuclear force. Now the coward is running away before the fruits of his Monsanto laced poison come to bare. You obviously live only for today and for yourself, proof you have no children to concern yourself with.

      • hussflier

        People should be smart enough to not bring kids in to this world now! I know you won’t feel like a normal person not having kids! That is the same way sheep are wired! You dont have to have kids selfishness is the only reason people have kids now!

        • cherylmeril

          No, it’s human instinct to have children that’s deeply ingrained in our culture. People have faith in God He will take care of their children.

    • Syrin

      When the entire system crashes from 50,000 feet, rather than the 5,000 feet it should have been from, you won’t be thanking the Chair Satan. Your cranio-rectal syndrome is advanced.

    • Gay Veteran

      you mean when he bought the worthless mortgages from the banksters?

    • Dutch

      Are the banksters nobility? Why should they have help and get bailed out for stupidity? I was and still am out of debt. Why should banks and heavy speculators get bailed out diluting the value of the rest of the money in existence? Those people who were responsible with money and debt would have been rewarded in 2008. Instead we just switched the problem to a different credit card.

      We still have rabid amounts of speculation in our economy. The ultra low interest rates destroy savers and producers and favors spenders and speculators. He did nothing for the economy. The economy just refinanced itself instead of actually dealing with problems.

      Should interest rates rise by just a few percent debt will grow at a much faster pace and the already worried bond holders might sell (gov debt would also skyrocket). Also if the gov doesn’t maintain a deficit at least as large as the trade deficit the American economy will fall into a liquidity trap (like it almost did in 08). This is the single largest problem in the economy the massive nearly 700B trade deficit. The Gov/Fed is the only entity that can cover this deficit without draining the economy of $ but only for so many years before extreme issues develop. The Fed/Gov acts like a money printing machine that fills the economy with $ as the money drains to foreigners that give us goods for those $ IOUs.

      Unless the US neutralizes this deficit we are going to be in more trouble than we were in 2008. In the last crisis the US gov/Fed dumped 10 T into the economy (the debt went from 7 to 17 T and this does not include a large fraction of the QE stimulus) if we don’t fix the issues that have been developed for over 40 years the US might have to dump many times this amount into the problem next time.

      The only reason the US gets away with it is our huge military (navy primarily) that secures our world reserve petrodollar status. Should this status be lost our GDP could be cut by 25 to 50% and our debt would grow exponentially. No one can say when this problem will manifest or how.

      We aren’t saved at all from the financial crisis of 2008. Ben just found a way to create an ever increasing mountain of debt for us to fall off of at a later date.

  • markthetruth

    The article makes the point.their handing it off to a women.

    ____This is Becoming a WOMEN’S World !!!___

    the end…

    • cannuck21

      Good Grief!

    • Ayn Rand

      Depends on the woman. My mother would be a great example of a perfect female leader. As would many others. Don’t believe that Women are the problem, or that Men are the problem. Elitist a**holes are the problem.

      • markthetruth

        Read article

        Men are disappearing from the workforce

        the end…

        • Ayn Rand

          As long as one parent stays home and takes care of the kids, I say it is good.

      • cherylmeril

        Satan and the dark forces of this world are the problem along with a fallen mankind. Jesus is the only answer to the problem, the Word of God, laying down our lives at the cross, accepting Him, repenting of our sins, etc.

    • Ralfine

      IF YOU’D GIVE THE JOB TO MY GRANDMA, YOU’D HAVE MONEY IN THE POCKET, BUT A VERY SMALL ARMY.

      (SORRY, CAPSLOCK IS LOCKED)

    • grumpyhillbilly

      A female won’t be as criticize for any Fed failure. In fact anyone questioning her will be labeled sexist. Its the game the elite (who are still men) like to play. Look at the Vacationer in Chief. He’s a front guy, who is just doing what he is told. Question him, and you’re a racist.

      • markthetruth

        Not now with all the gay and lesbians.
        Men are women and women are men.

        the end…

        • Gay Veteran

          poor mark, pining for the 50s when women knew their place (in the kitchen), blacks knew their place (in the back of the bus), and gays knew their place (in the closet)

    • BonusGift

      The significance is not so much that it is a woman as the 800 lb. gorilla in the room no one dare mutter: Hint: they call themselves a tribe and control the mainstream media, most of finance, Greenspan and Bernanke belong to it, and our politicians bow and scrap before them.

  • GSOB

    Interesting development.

  • markthetruth

    One thing i hope everyone catches is:

    The analyst in one article. try to convince us that there’s no inflation !

    Then when it comes to the stock market, even with the huge run they had, they try to convince you that they are still cheap on an inflation based calculation .

    Inflation is used and manipulated to double talk us into false reality at their convenience.

    the end…

    • captain america

      The stock market has rallied because the dollar is being gutted by the likes of Ben & Barry’s destruction machine

  • JailBanksters

    No inflation still, well that just means it’s perfectly safe to print, baby. Guess Vampires don’t have to buy food at Woolies and can Fly so they don’t see Inflation.

  • goldminer

    The rats know when to leave a sinking ship.
    Alan Greenspan resigned in Mid 2006. Just before the SHTF.
    Bernie is getting out and running fast before he gets his fancy pants suit soiled.

  • Aussie Jack

    Interest rates are not going to rise anytime soon. Not while the U.S. economy is languishing so badly, and my assessment is that it will remain that way for a long long time – at least 10 years, maybe longer.

    • cherylmeril

      Well then why have then been going up lately?

  • Chris

    interesting final three paragraphs Michael. Going back to your chart of yesterday of the S&P over the last few decades it looks blindingly obvious that the next crash is literally staring us in the face and could happen anyday. All it requires is some piece of bad news/bad event to come out/happen either deliberately (if these booms and crashes are manipulated) or not and the thing tanks. Rising interest rates will definitely cause a crash/major correction of some sort. Something is going to be probably deliberately leaked to burst this now that the important insiders have got out and the idiots have gone all in. What will it be is the question and presumeably it will be better for Bernanke to have gone just before so he doesn’t take the flak so much.

  • TooLittleTooLate

    Ok, I have an honest question: How is it that interest rates go up? If the FED is buying by far the majority of all our treasury sales, how is it that they can’t just set it to whatever they want and leave it there? The market may want an adjustment but, as long as we’re buying our own t-bills and printing money, can’t they just leave the interest rates where they are?

    I’m not economic genious for sure… somebody please explain this to me.

    • Gay Veteran

      the more money they “print” the less the dollar is worth, thus inflation

  • RM Molon labe

    so he is leaving…does that mean he CAN’T be held accountable for destroying our country? I say let him leave for now…but imprisonment later…that’s what SHOULD happen to this traitor…molon labe!

  • Stezie

    If he’s jumping ship, that’s not a good sign…

  • El Pollo de Oro

    Ben Bernanke (or as Gerald Celente calls him, “Osama bin Bernanke”) is leaving his position as head oligarch for the Federal Reserve. My response: good riddance to bad rubbish.

    Ron Paul is right: the Federal Reserve needs to be audited, and the sooner the better.

    • Ayn Rand

      The Fed needs to be burned to the ground. Private businesses given government powers do not make for a free market.

      • El Pollo de Oro

        I think the Fed is scared to death of an audit because if an audit did occur, people would see just how thoroughly rotten the Fed is……..and they’d want to burn it to the ground.

        • Ayn Rand

          True. Certainly would put a lot of people on our side.

  • El Pollo de Oro

    Mussolini would love what The Banana Republic of America has become.

    “Il fascismo dovrebbe più appropriatamente chiamarsi corporativismo perch’è una fusione tra stato e potere corporativo.”—Benito Mussolini, a.k.a. Il Duce

    Translation: Fascism should more appropriately be called corporatism because it is a fusion of state power and corporate power.

    • Washington76

      You are correct. Now, we have to reach all of the Serfs of the states who have been lulled into a coma state of mind by government schools. Thanks’ for your comment Vato!

      • El Pollo de Oro

        De nada, guay, el placer es mio. Órale!

        Here in Philly, I talk to a lot of delusional yuppie Democrat-for-life types who think the BRA is on the road to recovery and that the American middle class is doing just fine. I typically hear comments like, “If the economy is doing so badly, why is that high-end hair salon in Rittenhouse Square booming? Why is Whole Foods still crowded?” My response: “You’re not looking at the big picture. It’s smoke and mirrors. High-end hair salons in the nice parts of North Bogotá, are also booming while the shantytown slums in South Bogotá are as nasty as ever.”

        • Washington76

          My grandfather always said if you want to know a town simply go to skid row. You will learn everything you will need to know about the community in total. We learned from similar people, thanks for the exchange. Be well, and be blessed!

  • Daniel Calthorpe

    Daniel 12 “set up”=625 bc{neo/babylonian empire}
    + time times etc {1260} = 636 battle yarmouk
    -625 + 1290 = 666
    666 + 1335 = 2001 New York 9/11
    6 is mans number begin with 6 + Osama Bin Laden
    A=6 B=12 C=18 etc Y=150 Z=156 try 6 + Adolf Hitler 6 + Ronald Reagan 6 +Gamal Nasser no 6 prefix required New York

  • Richard Fontaine

    Wait till all the sheeple figure out that when interest rates rise you lose 50% of your money EVERY TIME rates DOUBLE. Not hard to double interest rates when you are starting at 2% on the 10 year Treasury. Now that might be why the elites are arming themselves with hollow points.

    • Boo-urns

      Explain please.

      • Richard Fontaine

        A bond with a set interest payment changes value as interest rates change. Whatever rate the bond is at the MARKET PRICE is reflective of the relative attractiveness of that bond compared to what rate of interest a buyer can get at that time. So now with a 10 year US Treasury selling to yield 2% all other fixed income investments adjust to that level of interest in the market. When a NEW US TREASURY BOND has to be sold at 4% then all other fixed income investments will have to have their MARKET VALUE reduced to roughly half of what they were to COMPETE with the newly available rate of interest that can be bought by the buyers of bonds. This is nothing more than MATH not speculation. WHen existing bonds of long maturity have to compete with NEW BONDS being sold at higher rates of interest then the market value of ALL FIXED INCOME WILL DECLINE to be competitive with the newly available rates.
        What this boils down to is that any longer maturity bond or mortgage excetera will be cut in half every time prevailing interest rates double. WHich of course is the real reason Bernanke is leaving now. He knows that the public will be crushed when rates are allowed to rise again to a more normal rate of interst of from 5% to 8%. THE LOSSES IN ALL FIXED INCOME PORTFOLIOS WILL BE MASSIVE. Think of millions of angry IRA, 401Ks, ect all going down by 50% to 75% in a matter of weeks. This has already been happening in EURope over the last year. Forewarned is forearmed.

  • cherylmeril

    God didn’t give power to the NWO, you don’t understand how He works. He merely removes restraints on Satan where all the bad things come from. The restraints are removed based on the sinfulness and lack of repentance of a nation or peoples.

  • El Pollo de Oro

    Idealists and ideologues, both knee-jerk Obamabots and knee-jerk
    Republi-Cons, don’t like hearing that the former USA is now The Banana Republic
    of America and that the Federal Reserve is rotten to the core. And I hear the
    usual nonsense from them: America will always be number 1 (yeah, they said that
    about the Roman Empire), Obama will lead us to the Promised Land (ha ha ha ha
    ha!), Republi-Cons will lead us to the Promise Land is we just give them
    another chance (sort of like a battered wife who thinks her psycho hubbie will
    quit smacking her around), Alex Jones and Gerald Celente are just cranks (no,
    they’re brutally honest), Ron Paul is wrong about auditing the Federal Reserve
    (actually, he’s spot on), you’ve obviously never been to a Third World country
    (wrong, I’ve been to both Latin America and North Africa……he visitado Latinoamérica y el norte de África). Many people can’t handle the truth; so the
    truth will kick them in the head and kick them hard when they wind up living in
    shantytown slums or become the victim of Honduras-style kidnappings.

    “We’ve been robbed in broad daylight by the Wall Street Mafia, and you haven’t seen one
    head roll.”—Gerald Celente

    “People are belly-aching that capitalism has run amok. This is not capitalism. The merger of state and corporate powers, by definition, is called fascism. And four words can prove
    it: too big to fail.” —Gerald Celente

    “The United States is the largest debtor nation in the history of the world.”—Jim
    Rogers, Quantum Fund co-founder

    “We’re already in a societal collapse. You have massive unemployment. You have
    overwhelming usage of food stamps, especially when you compare it to ten years
    ago. These right here are signs of a societal collapse. If it goes really deep, you are going to see waves of death.”—The Patriot Nurse

    “We haven’t even had THE economic crisis that I think is coming.” —Ron Paul

    And no, preppers, you aren’t nuts. Far from it. I’ve said it before and I’ll say it again: preppers are downright sane.

  • agglebert

    look, these fed guys do what they are told until they can’t take doing the wrong thing anymore or they don’t want the blame for the destruction that is planned. he probably is getting out before the collapse which has a few years to go…it won’t crumble until “they” are ready for it to crumble.

  • Economytrap

    What do you all not understand??? Bernanke cannot quit QE, or the economy will sink. HOWEVER, as long as we maintain this pace, more and more people/countries/institutions will continue to lose faith in the dollar, they’ll get out of treasuries and other U.S. dollar based investments (even China once they finish there trasition out of the dollar)…and in time we will have no option but to crash. We wont be able to print, but we also won’t be able to let interest rates rise. So it’s a lose lose situation. The best thing for this country right now is for the FED to stop immediately, let the painful but necessary correction take it’s course with NO INTERFERENCE…but obviously this is wishful thinking and will never happen given our educated Keynesian fanatics running the show. Here’s a thought, what if it’s all intentional? What if it’s an engineered problem that can only be fixed with bringing in a new system, a new solution, a one world financial system. Then the powers to be and the FED won’t look so dumb after all, in fact they’ll look like they knew what they were doing all along, and maybe we the sheeple didn’t give them enough credit for being that smart.
    Hey Mike whats up with the Housing article???

  • Gene Baugh BBA

    Let me ask you one simple question.
    What would have happened had the FED and the government NOT done what they have done since the beginning of the financial collapse?

    • Economytrap

      I’ll be a short as I can…The country still would have went through a deep recession/depression, but it would have been over by now. A free market always needs to rid itself of artifically inflated prices, artifical bubbles, malinvestments, and misallocation of resources…So the free market forces naturally “correct” itself to bring the economy back to equilibrium prices. People demonize these corrections as the scary terms of “recessions” and “depressions”. Had the free market been allowed to clean itself, too make itself more efficient, too allow prices to come down…then many, but not all, “too big too fail” institutions would have failed and or downsized, allowing others a chance to take their place with a cheaper, more efficient system that would have produced just as much if not more jobs. But instead, society was brainwashed to believe that it was in the best interest if we “saved” these institutions and the jobs with them. These institions were a major player in the downturn, and these people gambled, lossed, and were bailed out for taking large risks. We as a nation need to stop thinking of the short-term, and think about the long-term…All the Fed and Gov did was put-off the inevitable of a NECESSARY market correction, it’s just when this correction happens, it will be worse than had they let it happen in 2007.

      • Economytrap

        If I were in charge during that crisis, I first would have locked up Alan greenspan indefinately, lol. Then I would have focused on craeting an environment for businesses to thrive (thus helping to create jobs). Notice I said help, because the Fed nor the Gov create jobs, all they can do is help create an environment for job creation. To create a job environment is actually very simple…lower the cost to do business…this allows businesses to invest the surplus cash to expand and grow, and in turn hire people. Also, would have focused on creating an atmosphere for savers with higher interest rates, and lower inflation (which in turn reduces the prices of commodities, which in turn, lol, will lower the cost of raw materials for businesses to produce). Next I would have deregulated as much as possible, because, which in turn also lowers the cost to do business. Then after the economy slowly picked it’s way back up within a couple years, I would disband the Federal Resere and give the authority to print and coin money back to congress.

  • your.havin.a.laugh

    for all you idiots out there GOD does not exist

  • your.havin.a.laugh

    god bhahahaha

  • Richard Fontaine

    Why bonds will fall as interest rates rise.

    · Origional post:
    · Wait till all the sheeple figure out that when interest rates rise you lose 50% of your money EVERY TIME rates DOUBLE. Not hard to double interest rates when you are starting at 2% on the 10 year Treasury. Now that might be why the elites are arming themselves with hollow points.

    A bond with a set interest payment changes value as interest rates change. Whatever rate the bond is at the MARKET PRICE is reflective of the relative attractiveness of that bond compared to what rate of interest a buyer can get at that time. So now with a 10 year US Treasury selling to yield 2% all other fixed income investments adjust to that level of interest in the market. When a NEW US TREASURY BOND has to be sold at 4% then all other fixed income investments will have to have their MARKET VALUE reduced to roughly half of what they were to COMPETE with the newly available rate of interest that can be bought by the buyers of bonds. This is nothing more than MATH not speculation. WHen existing bonds of long maturity have to compete with NEW BONDS being sold at higher rates of interest then the market value of ALL FIXED INCOME WILL DECLINE to be competitive with the newly available rates.
    What this boils down to is that any longer maturity bond or mortgage excetera will be cut in half every time prevailing interest rates double. WHich of course is the real reason Bernanke is leaving now. He knows that the public will be crushed when rates are allowed to rise again to a more normal rate of interst of from 5% to 8%. THE LOSSES IN ALL FIXED INCOME PORTFOLIOS WILL BE MASSIVE. Think of millions of angry IRA, 401Ks, ect all going down by 50% to 75% in a matter of weeks. This has already been happening in EURope over the last year. Forewarned is forearmed

  • Greg Johnson

    Obamanankenomics!!! This is going to end very very badly. The next crash will be far worse than 2008. Obama, Bernanke, Reid ,Pelosi, Schummer, Clintons, countless others should be tried for treason and imprisioned for their crimes against America. The current administration is the most corrupt in America’s history by far!!! America is burning slowly to the ground. Look at cities conmunities run by black leaders it is dismal, 3.7 trillion spent just the last 5 yrs on welfare. Have things gotten better, hell no they haven’t !!!
    Obamas record / 7 trillion more in debt in 5 yrs
    Lowest labor participation rate in 35 yrs
    First Credit down grade.
    Fast & Furious gun running sting gone bad.
    Bengazi, ambassador and three American heros killed, but Hillary & Obama know nothing..
    NSA massive spying on Americans, foreign leaders, our friends…
    OBAMACARE, WORST BILL EVER PRODUCED. LIES, LIES, more lies from Commander in chief.
    Economy producing part time jobs, destruction of the middle class.
    You cannot take money from one and give to another this does not produce prosperity.This helps no one, it hurts the creators and the takers.
    Greed, lack of morals, socialism are what is destoying America and doesnt look like it can be stopped.
    God help America as she so desperatly needs his intervention to right this ship…

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