WSJ: Fed Buying 61 Percent of US Debt

Originally posted by Xcathdra
reply to post by ModernAcademia

 

This is nothing new... While people like to constantly parrot the "China holds the most US debt" it simply is not the case. The US government is the largest holder of US debt.

edit on 28-3-2012 by Xcathdra because: (no reason given)

Didn't know the Fed was the US government? Well, maybe they are. Maybe they are...

Second.

Its absoloutly amazing that they have been able to fool the majority, into not noticing or simply not caring about what it is they get up to.

Your story OP reminded me of one from a couple of months ago
Guess Which Country Has Debt Of Nearly 1000% Of GDP...

.......it's the UK by the way.

Together the 2 stories do more to convince me of a coming global meltdown and a one world currency, than any so called conspiracy theory.

Originally posted by Xcathdra

Originally posted by Fitch303
The people responsible for this should hang. After the crash happens the entire country will be looking for them.

You do understand that the people to blame are the ones posting in this thread... Are the ones who failed to vote / take an interest in government at all levels, etc etc etc.

The American people allowed it to happen... We watched it happen.... We knew it was happening... and yet we didn't feel the need to do anything to correct it. Apparently its more important for political parties to slam each other instead of doing their jobs.

We watched and failed to do our job.

I get what you are saying, but I don't agree with you. Blaming the victim is not going to work. You see, for starters many of us vote and many of us try to use the system (contact our congress-critters, try to inform others, etc) but you have to face the facts...

We The People have been manipulated. It is a natural progression. Look at every empire and see how the greed inherent in humans works. Once people get power, they use that power to get more. If they are stupid, they will do it abruptly and the people revolt. If they are smart, they will slowly boil the frogs. Let the frogs have little luxuries and distractions while those in power slowly siphon from the masses.

It is parasitic. You are blaming the host for allowing a successful parasite to inhabit it.

reply to post by ModernAcademia


Duh...

Why do you think the price of oil is so high?

Monetization: Also known as "Taxation Without Representation"
You pay more in Inflation Tax per year than you do in actual taxes.

reply to post by Rockpuck


Pray tell..... how does that work?....You have a way of explaining it that I appreciate.

As inflation and deflation are essentially "controlled" by the monetary policy makers, how do they manage to conceal the net effect of moving the wealth to one side or the other of the equation? I am trying to reconcile the analogy with a "hidden tax."

This is not important. Don't worry about it. Economic "experts" are on top of it. It's too complicated for you to understand. They could explain it, but it would just confuse you, so don't worry, nobody's stealing anything from you, let the experts take care of it. The economy is in a mess due to circumstances you just can't understand, but they do. All this crazy conspiracy theory talk about how they are doing it on purpose is nonsense. They just made a few hundred WHOPPING BIG "mistakes". Then they "misspoke" about it. It's over your head, only Harvard educated "economists" can understand why it's just an accident, no one is thieving, it's just the economy, stupid. Inflation is just like a force of nature, it just happens.

ZIMMERMAN is much more important! GAY MARRIAGE will cause society to crumble! STEM CELL RESEARCH will end life as we know it! There is no way the Fed is enslaving you, that's just crazy conspiracy theory talk. LOOK AT KIM KARDASHIAN!

Originally posted by Maxmars
reply to post by Rockpuck

 

Pray tell..... how does that work?....You have a way of explaining it that I appreciate.

As inflation and deflation are essentially "controlled" by the monetary policy makers, how do they manage to conceal the net effect of moving the wealth to one side or the other of the equation? I am trying to reconcile the analogy with a "hidden tax."

If you don't understand how inflation is a hidden tax, then they have done a good job of concealing the net effect of moving all your wealth from your side of the equation and into their pockets. At least, they have concealed it from YOU quite well.

Originally posted by Apollumi

Originally posted by Xcathdra
reply to post by ModernAcademia

 

This is nothing new... While people like to constantly parrot the "China holds the most US debt" it simply is not the case. The US government is the largest holder of US debt.

edit on 28-3-2012 by Xcathdra because: (no reason given)

Didn't know the Fed was the US government? Well, maybe they are. Maybe they are...

Second.

Conspiracy theories aside, the Federal Reserve performs the job that is delegated to Congress in the Constitution. There is nothing that prevents Congress from establishing an entity and assigning it the responsibility to oversee / manage an area that falls within their purview.

With that being said I dont like the Fed and I fully supporting chucking it to the curb and forcing Congress do to their job instead of delegating it out (something as important as our monetary system).

To clarify for some - The Fed was established by Congress, and Congress can exercise oversight (a term they should look up). The Board of Governors to the Fed is appointed by the President. The Fed is classified as an independent agency within the structure of the US government (oversight by congress, appointed by President).

The reason established for that setup was to keep politics out of the monetary system. One of the reasons the Fed was created (supposedly) which gained support in the independent area going forward from the great depression onwards.

The Fed doesn't need approval for its actions towards monetary policy. However Congress can exercise oversight at any point, yet have failed to do so). The Fed had a 100 year charter that was recently up, and was extended by Congress.

There is absolutely nothing that prevents the US public from contacting their representatives to voice your opinions and concerns over the Fed, or to demand Congress do their job instead of delegating it out for more accountability purposes.

The White House recently added a section called We the People, which allows individuals to submit a petition on whatever topic. If the petition gains enough signatures, the White House stated they would review it and go forward with it or decline to an issue a reason for declining.

This last week Congress implemented their version, which allows citizens to get directly involved in creating / drafting / supporting specific legislation.

This topic seems like it would be good for both venues.

However, things are only going to change when the American people remind the government who they answer to.

That requires involvement....

There is a saying in politics - There are 2 things you never let the voter see made - sausage and laws.

I think its time the American people leave the queasy stomach at home and get directly involved in how the items are made. Maybe we can cut out the fat and get more humane methods in place that make sense.

reply to post by nydsdan


I am blaming the people because we are to blame. We have evolved into this relationship with government that reminds me of domestic abuse. The public gets pissed at the government, and when they take action they change their minds and cry out dont take him to jail I luuub him.......

and so the cycle goes....

We know its a problem.....
We can pin point why its a problem...
We know that making changes can fix the problem....
We know who can..... Oh look, MSNBC is going after FoxNews because they ran a piece on CNN who covered why ducks are being eaten in the everglades because of an invasive species of snakes has taken root because idiots bought them and released them into the wild because, this one time at band camp..........

We, the American people, are like a Ferret on crack...

There is 435 members in the House and 100 members in the Senate.....

There are over 300 million of us.....

It is our fault....

reply to post by Maxmars

As inflation and deflation are essentially "controlled" by the monetary policy makers, how do they manage to conceal the net effect of moving the wealth to one side or the other of the equation?

Works like this (it's magical mind you...)

The USA has a budget deficit of $100 dollars. They can one of two things

A.) They can raise taxes via payroll, income, anything, by $100 to cover the gap. People grumble grumble grumble and politicians look bad.

B.) They can print $100 dollars and cause an additional 2% inflation ontop of CPI inflation (which are two entirely different things) By depreciating the value of a Dollar they kill two birds with one stone. They lower the over all value of ALL outstanding debt and they cover their own new expenses through the simple process of inflation.

When the Feds boost inflation through the process called Monetization (buying your own debt with new Dollars you pull from thin air) or through Quantitative Easing (printing money and throwing it at banks and tell them to buy the debt) they lower the value of all Dollars in circulation. If it occurs at a time when other Central Banks are not monetizing there is a phenomenon that creates a disjointed relation of our currency as compared to other currencies. Since our Monetization and QE is very high (60+% of our debt) the US Dollar is disjointed from other markets.

(This causes the price of oil to rise. It causes the price of bread to rise. It causes the cost of electricity to rise. It essentially causes everything to rise that isn't included in the CPI inflation report)

People know things get more expensive and then get cheaper, then get expensive, then get cheaper. They know it happens. They have no idea how or why. It all goes back to Federally controlled inflation methods used to create short term taxes to cover the cost of government. But not calling it a tax. Because that makes people grumble. And it's much better to have average joe grumbling about oil companies and banks than it is to grumble about the Federal Reserve. Which about 2% of the population even understands.

There are numerous methods to create inflation and deflation, it's not always the obvious buying of debt, interest rates as well can effect the inflation rates. It all depends on what's needed in the economy.

The point of the matter though is simply this: When the US Government through the Federal Reserve print billions of new Dollars it costs them........ Nothing.

But it will cost YOU an extra $10 to fill your car.

That's a tax.

(I should add how they conceal it is very simple: First and foremost, never talk about it. Second, make it so complicated that even when you do talk about within 30 seconds the average person's eyes glaze over. )

reply to post by Xcathdra


It's gonna get harder and harder to get rid of the Fed as they take on more and more of the U.S. debt. The Fed's control of the U.S. debt gives it leverage and power over the U.S. Gov't.

Originally posted by xuenchen
Does this mean that there is less "demand" for U.S. Treasury bonds and notes on open markets ?

If so, an interest rate hike may be in the works.

But that creates a catch-22 I think.

BTW, where does "The Federal Reserve" get the money ?
:puz

The printing company

The American Dream -a simple animated explanation of how the private Federal Reserve steals your money and why it must be stopped...

reply to post by Rockpuck


Good post Rockpuck.

I would like to add, that even moreso, since the US Dollar, is the world's reserve currency, when the FED prints more dollars, it also lowers the value of those entities and people overseas holding US Dollars.

The Mortgage scam the Banksters pulled off was theft not only from American's but also from people around the world. Since, there are so many that hold US Dollars here and around the world, they thought they could get away with it, since there is a huge number holding them to cushion the effect.

Well, many countries are dumping their dollars and with good reason.
They will have less tricks up their sleeves when there are not as many suckers to play their game.

Of course, that is a lot of what the wars are about.
Maintaining Hegemony to keep the reserve dollar in place.

And here I thought our success in this country was about Capitalism and Free Markets.

What would have happened during the Cold War, if Russia held the reserve currency and the US dollar was on its on?

reply to post by jacobe001


Yup, good point that I should have added. We are not effected when the Euro bounces around, or the Yen tanks, it only effects the relative position of our currency (import exports) but when the USD fluctuates the whole World suffers.

We can tax you all.

reply to post by ModernAcademia


61% of zero is zero. But since they paid zero for it they are still up.

They aren't so stupid after all!

Inflationary endgame.

The end of capitalism as we know it!

The world is about to get blindsided by socialism. When capitalism finally commits suicide in a blizzard of printed fiat cash, the people will turn their faces to the rising Red Star again.


Heady stuff. Bring it!

It is interesting to note that the 61% "propping" that has occurred is almost equal to the rebound in the market since 2008. The market has rebounded by 50%. Basically, only 11% of the rebound is from true economic growth, which is inline with the rate of economic growth they have reported since 2008. The rest is the result of purely propping up the dollar. This will not end well.

Russia and China stop trading in US dollars between the two countries in 2010. This lowered demand for the dollar. Now, this news will make investors (mainly countries) avoid the dollar like the black plague because they are afraid the dollar will fail. The petro-dollar system is quickly going to the wayside which is how the dollar was made the world reserve currency. This is fact because of the new deal made between Saudi Arabia and China with the world's largest oil refinery ever! Therefore Saudi Arabia will want to sell their oil in the Chinese Yuan verses the dollar. The dollar has lost over 28% of it value against the Yuan since 2007! "The $8.5 billion joint venture, which covers an area of about 5.2 million square meters, (Little over 2 Square Miles) is already under construction. It will process 400,000 barrels of heavy crude oil per day. Aramcowill hold a 62.5 percent stake in the plant while Sinopec will own the remaining 37.5 percent."
www.chinadaily.com.cn...

Our country has tried monetizing its own debt by printing more money through the guise of quantitative easing 1 and 2. 2.2 Trillion dollars has been printed out of thin air since 2008 to be exact. This ALWAYS creates inflation so they lowered to interest rates to almost nothing to put off the strain on the economy. That is like robing Peter to pay Paul. It always comes around in the end. Now we are buying our own debt! That is subsidizing our own debt. This never works in the long run either! They HAVE to raise the interest rates higher than what the REAL inflation rate is and that still may not save us. That is the only chance we have. Does history tell us what happens when a country monetizes or subsidizes their own debt? Absolutely! They fail because they devalued their currency to nothing!

"Weimar Germany — Mark 1919-1923 12 marks to 4.2 Trillions Marks!

In 1932, Argentina had the eighth largest economy in the world before its currency collapsed. In 1992, Finland, Italy, and Norway had currency shocks that spread through Europe.

In 1994, Mexico went through the infamous “Tequila Hangover,” which sent the peso tumbling and spread economic hardships throughout Latin America.

In 1997, the Thai baht fell through the floor and the effects spread to Malaysia, the Philippines, Indonesia, Hong Kong, and South Korea.

The Russian ruble was not the currency you wanted your investments denominated in in 1998, after its devaluation brought on economic recession.

In the early 21st century, we have seen the Turkish lira experience strokes of hyperinflation similar to that of the mark of Weimar Germany.

In present times, we have Zimbabwe....."
dailyreckoning.com...

You have to be completely in denial or blind to not see this coming now. Prepare for very hard times ahead right now to ease the pain of loosing all those "creature comforts" that we have become used to our whole lives. Buy manual things instead of electrical. ie can opener. Have a clean water source. Canned goods and dried/canned meats etc... If you made it this far, then good for you. It shows you might take this serious.

reply to post by ModernAcademia


I don't understand, how is this even possible? And they really expect the USA to continue on? It seems the longer this drags out the worse it's going to be...

Originally posted by Leftist
The end of capitalism as we know it!

End the monetary system!! End this madness killing us all called profit!

Oh...and we could also change the people that led us to this point.

Contrary to what they WANT us to believe, human being are smart enough, evolved enough and have enough empathy to make the whole system work. Most people in the world are not evil and racist.
We do not need bankers and corporations slaving us more and more trough inflation.