I watch the economic news with interest . I find it a bit rich and ironic the “maestro” — Alan Greenspan, former Federal Reserve Chairman, recently realized entitlement spending is draining capital investments dollar for dollar. Where the hell has this guy been?
This is also the guy who didn’t see the housing bubble of 2007-2008 being a problem. When he saw more and more people who could hardly afford to rent buying houses with no or little money down, he didn’t see a problem? When the markets hit bottom, so did the housing market.
Those rising valuations on housing, in turn owners borrowed in the increase in equity, in the end many of those involved owing more than their properties were worth declared bankruptcy and walked away from responsibility of payments, both for the properties and loans on equity. The banks panicked, and the downward spiral into the financial abyss was exacerbated. And Alan was clueless when it happened? What crystal ball was he watching?
His successor, Ben Bernanke, when asked about gold, said gold wasn’t “real money”? I guess Ben is of the thinking he knows the price of everything but the value of nothing. The whole idea of our system of capitalism is paper script backed up by something of value (gold). Since the paper you have in your wallet or purse is just that — paper — it is a promissory note with the full faith and backing of the United States Treasury, whatever that is worth. Right now, minus inflation, it is whatever goods and services can be acquired with the capital presented.
Since we were taken off the gold standard (as much gold in reserve to cover the script being printed) by President Richard Nixon in 1973. It was a system of fixed exchange rates and changed to a system of floating rates.
Now we have a problem again with a housing bubble brewing like it did over 10 years ago. The old problem of supply and demand in housing inflates the price for homes, many existing desirable homes are going for over the asking price among those competing to buy. It is a great time to be a seller… for now.
In addition, President Barack Obama saddled U.S. taxpayers with the college loan program that used to be administered by banks. Evidently Obama had so much faith the in federal government to run programs effectively and efficiently that he took on the responsibility for the government (us) to loan money for college.
College students now owe $1.56 trillion spread out among 45 million borrowers, according to recent figures. Included in that figure, $101.4 billion in loans are in default among 5.1 million borrowers. In simple terms, that is about 1 in 15 borrowers go into default due to declaring bankruptcy.
Just last week, Rep. Maxine Waters (CA) (aka “Auntie” Maxine ) was grilling bankers assembled on the Hill to address Congress over the college loan program. She asked what they were doing about the high cost of college loans, not realizing they no longer loan money for college. It was explained to her that they no longer offer college loans since the federal government took over the loan program. I know she is clueless much of the time, but this is really a great example of her being a perpetual “know nothing” and by a U.S. Representative who is the ranking member of the House Financial Services Committee, no less. Doh!
I think President Donald Trump is onto something when he complains about the Federal Reserve and how outdated the system is. Maybe it is time to jettison the whole idea of the Federal Reserve; it is a private, for-profit corporation. It has outlived its usefulness, if it ever was. Think about it — since 1913 we’ve had a Depression and many recessions and the efforts of the Federal Reserve did nothing to prevent them from happening.
On another front, President Trump is battling Democrats, he suggested since California is a sanctuary state and has so many cities within the state declaring illegal sanctuary status, the recent illegals detained at the border should be sent to California. What a brilliant idea!
But wait… now those same folks smugly saying they are sanctuary state/cities are crying foul? Say it isn’t so. Democrats, the party of the people, evidently aren’t! You can’t satisfy them. They don’t want anything to do with the Wall; evidently inviting drugs, crime and illegals across the border to melt into our country, but they have no ideas on how to address this issue except to keep the border as is. Who is looking out for American’s? It sure isn’t the Democrat Party.
The Democrats didn’t have a clue on why candidate Donald Trump was so popular and they don’t have a clue about President Trump. Ask any American who voted for him and they will tell you. But Democrats stay in Washington D.C. and let their professional handlers figure out how to beat him in the next election.
The difference between President Trump and Democrats is Trump loves America and Americans. The Democrat Party loves themselves and makes no attempt to find out what Americans think, need, and want. Want proof? Hillary Rodham Clinton.
The rotting of America from within continues…
Thank you for bringing up Greenspan’s comments and the Federal Reserve System, Ranger Rick.
The idea of the incompetence of the Federal Reserve is one thing. It would surely be bad enough if it were merely about incompetence. But those involved actually have a method to their madness. Any issue regarding a failure of the stated “mission” of the Fed, as it is called, totally pales in comparison to the fundamental insanity, blatant unconstitutionality and complete and utter foolishness and tragedy of Congress having handed over its sole constitutional responsibility for U.S. money and instead having allowed the existence and power of the private banking cartel known as the Federal Reserve System. Jefferson and others warned against this taking place.
Most Americans have no knowledge whatsoever of the background story and intentional insider development of the Fed, and how it came to be that the U.S. government actually gave in and gave over complete control of the production and management of the money supply and monetary policy of this country to this private banking cartel back in 1913. For many years I myself, like most, was not aware. Most Americans do not know that the Fed now creates all of the paper and digital fiat U.S. dollars literally out of nothing…out of thin air…and then lends those magical dollars to the U.S. government, large corporations and other central banks and governmental entities in the trillions at interest. The Fed sometimes deliberately creates huge losses to manipulate the national and global economy and the markets. These never-before-existent dollars created by the Fed suddenly spring into existence when the money is loaned out or assets are bought by the Fed. However, the U.S. taxpayers guarantee the repayment of all of these trillions in funny money produced out of nothing and loaned it at interest. If the Fed did not already exist and it were openly explained to the American public it would be utterly unthinkable. But it already exists and has existed for over a hundred years. It has provided far worse than zero benefits to the American people. It has allowed the taxpayers, government, large corporations and foreign banks and governments to bury themselves in unimaginable and unsustainable levels of debt.
If we think that the Great Depression and Great Recession were bad, those terrible scenarios will look very tame one day compared to the much larger bubble by far that now exists and is growing every day since 2009. This bubble is larger by far and more dangerous than at any point in history, and it is about to burst one day soon with an awesome and devastating worldwide result. This is now the jeopardy of the current situation, fundamentally due to the existence of the Fed in cooperation with other governmental banking systems and world central banks. The people in the so-called U.S. “leadership” have utterly failed all of us as well as their own loved ones and families over the years by letting this beast grow into a huge version of the monster that it always was.
Those willing to educate themselves on the Fed, its origin and what has been happening as a result should on YouTube watch about the history of the Fed entitled “The Creature From Jekyll Island” by G. Edward Griffin, or read his book of the same title.