The Fed would wait for the pain to get intolerable and then would reenter with a third round of quantitative easing. Simply said, the Fed will wait for us to beg for the poison that is killing us… more counterfeit money.
The business of America's business had become passing paper around, a process called "securitisation". The financial sector (lending money) contributed 44% of US corporate profits; only 10% came from manufacturing.
Billions of profits from money-lending allowed the finance industry to buy all the politicians it wanted, and keep the media docile. Financial regulation barely functioned and banks were allowed to lend US$35-40 for every US$1 deposit. Managers of the huge pools of unregulated capital called hedge funds had to pay only 15% tax while ordinary workers paid double, or more.
Washington's answer was more debt to cure the problems caused by too much debt. (so we have QE, QE2... check out inflation explained.
Money should not be made on money, but by creating and selling things of value. Bankers once played a useful role in financing long-term capital projects like roads, dams, bridges. They still can do so through the type of Islamic "sukuk" bonds in which banks share risk in projects they are financing and receive equity interest.
But today, much of the west's banking industry has become a parasitic scourge that is bleeding the economies of the US and Europe. The current financial crisis is due to runaway government borrowing, poor banking credit controls, and galloping greed.
The United States will likely remain mired in Japanese-style economic stagnation and deflation until the power of Wall Street is broken. I say this as an economic conservative, private fund manager, and long-time investor. ~ Eric S. Margolis
Needed: A new American Revolution
http://www.thesundaily.my/news/112633
Related readings:
How Japan was taken down: 一个协议击溃一个国家的经济
http://howtze.blogspot.com/2011/06/blog-post_05.html
The business of America's business had become passing paper around, a process called "securitisation". The financial sector (lending money) contributed 44% of US corporate profits; only 10% came from manufacturing.
Billions of profits from money-lending allowed the finance industry to buy all the politicians it wanted, and keep the media docile. Financial regulation barely functioned and banks were allowed to lend US$35-40 for every US$1 deposit. Managers of the huge pools of unregulated capital called hedge funds had to pay only 15% tax while ordinary workers paid double, or more.
Washington's answer was more debt to cure the problems caused by too much debt. (so we have QE, QE2... check out inflation explained.
Money should not be made on money, but by creating and selling things of value. Bankers once played a useful role in financing long-term capital projects like roads, dams, bridges. They still can do so through the type of Islamic "sukuk" bonds in which banks share risk in projects they are financing and receive equity interest.
But today, much of the west's banking industry has become a parasitic scourge that is bleeding the economies of the US and Europe. The current financial crisis is due to runaway government borrowing, poor banking credit controls, and galloping greed.
The United States will likely remain mired in Japanese-style economic stagnation and deflation until the power of Wall Street is broken. I say this as an economic conservative, private fund manager, and long-time investor. ~ Eric S. Margolis
Needed: A new American Revolution
http://www.thesundaily.my/news/112633
Related readings:
How Japan was taken down: 一个协议击溃一个国家的经济
http://howtze.blogspot.com/2011/06/blog-post_05.html
