The Fed has printed $4 trillion dollars. Attention is now focused on what they will do with interest rates, rather than $4 Trillion on their balance sheet.
Podcast Summary:
0:00-6:15 Introduction
Deficits Don’t Matter Again
6:15-11:34 Discussion of the renewed focus on the Fed’s policy towards interest rates now that they claim they will stop printing dollars in October. It seems to be designed to take the focus off the $4 Trillion that they printed. The inflationistas have been drowned out by the recoveristas who claim QE worked, there is no inflation and the economy is improving and the stock market is up!
Now all eyes are on what the Fed might do with interest rates- not what they might do with a $4 trillion balance sheet. There is no further talk about unsustainable deficits and unfunded liabilities. Just talk about what the Fed might do about interest rates and how they might “fix” the labor market.
The stock market is held up by Fed policy. The longer the stock market stays up, the more people can be coaxed into it.
The US doesn't have a deficit problem,unfunded liabilities aren't an issue,there's no inflation,you can print $4T & fix everything Recovery!
— Smaulgld (@Smaulgld) August 26, 2014
The Media Continues Promote the Economic Recovery Narrative
11:34-18:20 Discussion of a recent report showing that the “average” household net worth is now $700,000.
The average US household's net worth is now $700k. Times have never been better for the average American, right? pic.twitter.com/z5nf1udMyX
— Jamie McGeever (@ReutersJamie) August 26, 2014
Discussion of how institutional and sovereign funds dominate the stock market. Stock prices are clearly over valued. There is a greater chance that stocks drop 30-40% than rise 30-40%. Italian and Spanish bonds are paying similar rates as U.S. Treasury bonds.
The Importance of Gold To Nations and Individuals
18:20-28:15 Discussion of Russia’s gold buying spree and the rest of the world’s accumulation of gold.
Discussion of the importance of gold to nations, other than the United States.
Russia adds another 300,000 ounces to its gold hoard.
Discussion of why countries hold U.S. Treasuries and the de-dollarization movement initiated by the BRICS and the potential impact on the dollar and the United States. Discussion of the movement of gold from west to east and Americans’ attitude towards gold vs. the rest of the world.
The Campaign Against Gold And For Stocks
28:15-33:30 Discussion of the price of gold and silver and their initial rise during the early days of quantitative easing. People bought gold for the wrong reasons. Gold is not an investment, it’s an asset. Discussion of gold and silver manipulation. Discussion of the movement from gold from west to east. Americans liked gold a few years ago because it was going up. They bought for the wrong reasons and many bought ETFs.
Have we Seen the End of QE?
33:33-35:29 Discussion how the Fed ends each round of QE in order to appear prudent.
Yellen’s Speech and the Media
35:29-41:30 discussion Janet Yellen’s recent speech on the labor market. Discussion how financial media shows have hosts that scoff at any criticism of the economy, any positive sentiments on gold or silver, or de-dollarization efforts. Discussion of currencies vs. gold and reckless monetary policy. Discussion of the U.S. focus on the dollar and neglect of gold.
Immigration Policy
41:30 -43:40 discussion of the difference between prior immigration policy and today’s. Immigrants were once sold on the concept of coming to the United States to work and in return the US would increase its production and both the immigrant and the U.S. benefited from that dynamic. Today immigrants are encouraged to come to the United States and the politicians hope by offering them benefits that they will vote for them. The U.S. can add to its GDP via government military spending. Discussion of taxation policy in the United States.
The Affordable Care Act Harms Job Growth
43:40 The Dallas Fed released a report that showed that employers have slowed hiring as a result of the Affordable Care Act. Click here to see the results of the survey.
Discussion of Republicans and Democrats. Discussion of the Depression of 1920 and how government intervention in the economy makes things worse. Discussion of how the Fed legally manipulates markets.
The Importance of Gold To Nations And Individuals
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Further Reading:
The Importance of Gold to Nations and Individuals
How Russia Can Create Hyper Inflation in the United States
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