We’re in a historically terrible recession. Job growth is non-existent. The wheels are about to come off the artificially pumped-up stock market and the American public is sick and tired of being lied-to by Congress, the White House, Wall Street, and most egregiously the Federal Reserve. The latter of which is at the root of all our economic woes.
At every economic downturn the Fed steps in to save the day by lowering interest rates or pumping money into the economy as Congress cheers them on. The problem with this scenario playing out time and again is that centralized monetary intervention doesn’t work. In the end it causes greater boom-bust cycles and more severe peaks and valleys across all markets as traders and corporations struggle to adjust as newly created money or artificially low interest rates interfere with normal market conditions.
In a perfect world interest rates and the supply of money would never have to change (save the birth-death rate). Under this scenario, markets would be allowed to function normally. Cheap money would never be able to cause market distortions in housing, or commodities, or any other market. If the supply of money remained constant and its value anchored to something like gold at a fixed price, then money would always settle into the economy adhering to the laws of supply and demand. Money would balance itself out without enriching only a thin layer at the top of the monetary distribution chain – namely the banks (the primary dealers) or the owners thereof.
But the moment a banker steps in and floods the economy with newly created money having no anchor to a fixed priced – only market distortion across all economic sectors can follow. Hence, centralized monetary planning by the Federal Reserve is the root cause of all our economic woes.
Until the general public understands this simple premise, we’re doomed to the whim of a small group of elite bankers.