Friday, September 30, 2016

The Banquet Of Consequences 
Is Being Served
Peak Prosperity: Central banks have crossed a dangerous line .. "Dangerous not just to the health of a market economy (that line was crossed a long time ago); but to its own existence. A central bank's authority is based on faith in its power to effect its mandate. Last week's decision was so toothlessly passive that even the Fed's cheerleaders are beginning to question if it has any clue for how to escape from the corner it has painted itself into. The Fed and its central banking brethren (most notably the European Central Bank, Bank of Japan, Bank of England and Bank of China), have decided to
sacrifice investing for tomorrow (namely savings, & capital expenditure in productive enterprise) in favor of higher prices today for financial assets. 
By keeping interest rates historically low -- and increasingly negative -- around the world, they have pushed capital much farther out the risk curve than it deserves to be. All while adding trillions of more debt into an already dangerously over-leveraged economy, and lavishly rewarding the rich elite at the expense of everyone else .. The dinner bell for the Fed's banquet of consequences has been rung. It's credibility is becoming increasingly stretched among mainstream audiences, and should it actually raise rates in December (forget about November, I don't think there's anyone left who still believes the Fed is not politicized),
it will be vilified by the ensuing market drop."
LINK HERE to the essay

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