Monetizing the deficit and suppressing those treasury yields to keep the banks solvent could be the goal of the Fed.

Should we expect anything different from a private banking cartel? 

Think about it. The Fed’s product is debt and the federal government is its prized cash cow now paying over one trillion dollars a year in interest payments on the 34 trillion dollar public deficit.

Monetizing The Deficit
Fed Chairman Jerome Powell

The Fed’s product is debt and the federal government is its prized cash cow now paying over one trillion dollars a year in interest payments on the 34 trillion dollar public deficit

WIN INVESTING

It is a movable feast for the cartel modelled on an animal farm with the product keyboarded into existence where every human living will be milked through taxation and inflation. 

Future generations with the features of their parents and the invisible shackles of state debts?

Technocratic socialism, where no private enterprise can compete with the big state funded by a central bank, its owners’ feudal lords presiding over neo-serfs, farm animals taxed, milked at the source. CBDC, the neo-serfs digital tag, for tracing and milking at the source. The technology already exists where we could be taxed by the number of steps taken per day and where the amount is automatically deducted daily from a digital wallet.

Don’t laugh, the state has taxed property owners for the number of windows a house has and restaurant owners for the number of chairs it provides.   

Ways of taxing

“the state has taxed property owners for the number of windows a house has and restaurant owners for the number of chairs it provides”

WIN INVESTING

Is this what lies ahead? 

Monetizing the deficit and a dystopian digital future under a neo-feudal caste system of nobles, financial elites, technocrats and serfs in an open-air digital prison.

“the Fed will slow down the reduction in their $7.4 Trillion balance sheet” – Win Investing

The Fed’s May decision on monetary policy flags what its priorities are, monitoring the deficit and suppressing treasury yields

So here is what the Fed announced it would do in May.

Rates will remain unchanged at 5.25%-5.5% target range. 

Historically, those rates are not high but it is the level of record household, business and government debt which makes those rates repressive. The Fed fund rate is the wholesale rate. Households and business rates are higher by multiples. The average credit card interest rate is 27.9%. Average business loan interests range from 6.13 to 12.36%. The average auto loan rate for a new car is nearing 8%.

So the current Fed fund rate of 5.25%-5.5% is a boot on the economy’s neck, bearing in mind the economy runs on affordable credit. Credit card defaults and unsold autos at dealerships are piling up. Corporate layoffs are also rising. Auto repossession hit record highs, and a wave of home foreclosures could come next at these current rates.      

But the takeaway from the Fed’s May meeting is that the Fed will slow down the reduction in their $7.4 Trillion balance sheet.

So the Fed will taper, reduce, quantitative tightening, the sales of treasury bonds. 

“Beginning in June, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion,” Fed Chair Powell.  

In other words, the Fed is disturbed by treasury bond yields above 5% and is capping bond losses. Moreover, potential 100-plus bank failures are making the Fed Dovish. 

What about mortgage‑backed securities? 

Screw the property market.     

 QT is bigger than expected (-$35BN/mth vs -$30BN expected)

The Fed is monetizing the public deficit, suppressing yields, saving the banks, the government, and screwing everyone else.

Are you surprised?  

Win Investing - Newsletter signup logo

Want the latest investor news as it happens?

Subscribe to our Investors Newsletter

You have Successfully Subscribed!

Pin It on Pinterest

Share This

Share This

Share this post with your friends!