The Federal Reserve has been the primary culprit of the economic collapses, the financial crises and the domestic downturns that have inflicted the United States. Indeed, the federal government and the central bank usually omit this fact from their analyses, and instead purport that everything has been contained.
Last week, speaking to the National Bureau of Economic Research in Cambridge, Massachusetts, Fed Vice-Chair Stanley Fischer conceded that another economic collapse is likely to occur, but urged policymakers to take the necessary measures to ensure it is foreseen and prevented.
Here are Fischer’s exact words that may have surprised some Fed critics, according to the Associated Press:
“We need always be aware that the next crisis–and there will be one– will not be identical to the last one and that we need to be vigilant in both trying to foresee it and seeking to prevent it.”
Of course the solution to avoiding a collapse is for the Fed stop inducing trouble.
Fischer further continued that regulators need to persist in ending the practice of the government bailing out the major financial institutions. The former International Monetary Fund (IMF) official and head of the Bank of Israel, who became the No. 2 man at the Fed last month, averred that the central bank would review the potential effects of instituting rigorous and far stricter rules and regulations on banks.
Indeed, there weren’t any remarks that the central bank is the instigator of the bubbles and the much expected financial collapse. Let’s look at the overheating elements of the market: home prices, social media and biotech stock bubbles, rising asset prices and bonds.
These comments from David Stockman, former Reagan budget director, are quite timely:
“At the end of the day, the Fed and its fellow traveling central banks have systematically dismantled the natural stability mechanisms of financial markets. Accordingly, financial markets have now become dangerous casinos in which speculative bubbles are guaranteed to build to dangerous extremes as the central bank driven financial inflation gathers force. That’s where we are now. Again.”
The Fed has previously collapsed three times. Everyone connected with it is aware that the fourth collapse is inevitable and that this one will for the first time include a default in the payment of the debt. This time the emperor is aware that he has no clothes, which is disloyal to the American electorate.
This is a pessimistic scenario of what could repeat itself, but much worse due to its size which is no possible to pay
A pessimistic scenario of future events includes a banking crisis, followed by a government bailout and the eventual nationalization of all banks. The final cost is staggering and is paid with money created by the Federal Reserve. It is passed on to the public in the form of inflation.
Further inflation is caused by the continual expansion of welfare programs, socialized medicine, entitlement programs, and interest on the national debt. The dollar is finally abandoned as the de facto currency of the world. Trillions of dollars are sent back to the United States by foreign investors to be converted as quickly as possible into tangible assets. That causes even greater inflation than before. So massive is the inflationary pressure that industry and commerce come to a halt. Barter becomes the means of exchange. America takes her place among the depressed nations of South America, Africa, and Asia—mired together in economic equality.
Politicians seize upon the opportunity and offer bold reforms. The reforms are more of exactly what created the problem in the first place: expanded governmental power, new regulatory agencies, and more restrictions on freedom. But this time, the programs begin to take on an international flavor. The American dollar is replaced by a new UN money, and the Federal Reserve System becomes a branch operation of the IMF/World Bank.
Electronic transfers gradually replace cash and checking accounts. This permits UN agencies to monitor the financial activities of every person. A machine-readable ID card is used for that purpose. If an individual is red flagged by any government agency, the card does not clear, and he is cut off from all economic transactions and travel. It is the ultimate control.
Increasing violence in the streets from revolutionary movements and ethnic clashes provide an excuse for martial law. The public is happy to see UN soldiers checking ID cards. The police-state arrives in the name of public safety.
Eventually all private dwellings are taken over by the government as a result of bailing out the home-mortgage industry. Rental property is also taken, as former landlords are unable to pay property taxes. People are allowed to live in these dwellings at reasonable cost, or no cost at all. It gradually becomes clear, however, that the government is now the owner of all homes and apartments. People are living in them only at the pleasure of the government. They can be reassigned at any time.
Wages and prices are controlled. Dissidents are placed into work armies. There are no more autos except for the ruling elite. Public transportation is provided for the masses, and those with limited skills live in government housing within walking distance of their assigned jobs. Men have been reduced to the level of serfs who are subservient to their masters. Their condition of life can only be described as high-tech feudalism.
There is no certainty that the future will unfold in exactly that manner, because there are too many variables. For example, if we had assumed that there will not be a banking crisis, then our journey would be different. We would not see long lines of depositors or panic-buying in the stores or closing of the stock market. But we would still witness the same scenes of despair in the more distant future. We merely would have travelled a different path of events to get there. That is because the forces driving our society into global totalitarianism would not have changed one iota. We still would have the doomsday mechanisms at work. We would have the CFR in control of the power centers of
government and the media. We would have an electorate which is unaware of what is being done to them and, therefore, unable to resist. Through environmental and economic treaties and through military disarmament to the UN, we would witness the same emergence of a world central bank, a world government, and a world army to enforce its dictates. Inflation and wage/price controls would have progressed more or less the same, driving
consumer goods out of existence and men into bondage. Instead of moving toward The New World Order in a series of economic spasms, we merely would have travelled a less violent path and arrived at exactly the same destination.