It goes even deeper than that. If covid goes away, then they will have to admit that not only is there a continuing economic crisis, but that the crisis preexisted covid by 6 months.
In Sep of 2019, something happened that caused overnight rates to go from near zero to 10% in a matter of hours. Some piece of news spread through the banking community like wildfire, and within a matter of hours none of them were willing to lend. To this day, we still don't know what it was. Probably that certain financial institutions were insolvent, but we don't know what the details were. Was it housing again, or something different this time?
Thanks to legislation from 2009, the Fed didn't have to go to Congress to get permission to restart QE, so they did it quietly. They announced they were going to commit a few billion to overnight loans because of a crunch in the overnight markets due to corporate taxes coming due at the same time as a bond auction. They argued banks wanted to hoard cash to buy bonds, and didn't have cash to spare because of the corporations withdrawing cash to pay taxes. That was a pretty lame excuse, but it held water for a few weeks.
But then the loans continued, and the commitments grew ever larger. Those of us who were watching knew what was up. As expected, the Fed's balance sheets grew, signifying that these weren't overnight loans. The Fed was printing money and bailing banks out of assets to keep them solvent. Many of you will now know that the Fed owns half the mortgages in the US right now, but what most of you don't know is that this started a full six months before the cough even made the news here, and months more before we started locking things down and eliminating jobs.
And of course halfway through the pandemic, the Fed finally admitted that they had been easing for months before the pandemic started, and many in the mainstream media openly admitted that we had officially entered QE infinity. Not only that, but without congress's approval, they expanded the list of assets they would hold on their balance sheets, just like when they expanded from bonds to bonds plus MBS in 2008. Now they hold bonds, MBS, junk corporate bonds, and they're straight up buying equities through proxies like Black Rock.
Their goal is to keep the markets inflated at all costs, to the bitter end. In my opinion, the pandemic goes beyond just hiding the reality of the economic crisis. The one thing the lockdowns have achieved is keeping the velocity of money low. All the printing the fed is doing isn't entering the real economy, which is why we're in deflation, aside from asset prices like housing and stocks. It's why you can get a hotel room for 20 bucks and gas is cheap, but bitcoin even is at 40k. All through the magic of high inflation primarily in derivatives, vs. extremely low velocity of money on main street.
This is also why they're loath to give too much stimulus money to mom and pop, but they'll give trillions to wall street and the banks. They know if they give too much liquidity to mom and pop the velocity of money will pick up and then inflation comes roaring in with a vengeance. Their game is to keep things going as long as possible, which means inflating the stock market as needed, while giving mom and pop just enough to keep a great depression at bay. And if mom and pop can't pay their bills, well that's just fine, because the fed can just buy their mortgages from the banks, giving the banks more money to inflate the markets even more.
That's why I don't believe for one second that Biden is going to follow through with any of his promises about giving lots of cash to people. Unless they know they're in the endgame. All this nonsense about UBI and debt forgiveness is bullshit. That would be tantamount to the banks simply giving people their cars, houses, and businesses like belated Christmas presents. Keep in mind that the banks don't mind losing those assets to the fed, because they're shareholders in the fed. When the assets come off their balance sheets and go onto the fed's balance sheets, it's like selling something to themselves, with money that they printed. And yes, they will eventually destroy the dollar doing this, but they don't care, because they have the tangible assets.
The best part is that they can even convert your deposits into bank stock, and then when the bank goes belly up, they still have their stock in the fed, which has all the assets. So no matter what, they win. Even if their own banks and the stock fold and become worthless, they still own all the stuff.
But don't worry! Their lapdogs in Davos have assured us that they're going to be benevolent masters. The people whose stuff they're going to repossess will just have to give up all of their human rights and privacy to be allowed to continue to live under a roof and eat food. But not meat. Because global warming.
If I didn't know any better, I would say their plan is to inflate the bubble as big as it can possibly get, and covid is an extremely useful tool for doing that. Not only does it transfer more wealth from the middle class and get people into more debt, making them less solvent, it lures them back into equities, real estate, gold, bitcoin, you name it. When the bubble does finally burst, everything will get wiped out and people won't be able to pay. Worse yet, they won't be able to raise money because most of the money supply will be destroyed, and demand for dollars will be great due to people needing cash to pay debt. With asset prices plummeting, people won't be able to raise cash to pay down debt.
I truly believe that's when the banks, possibly with congress, will offer the new deal. Sign this document giving up ownership of everything that's in debt, and we'll let you continue living in it, driving it, etc. I imagine business owners will be able to stay on as managers for signing over their businesses, too. It's nice and tidy. Doesn't tie up the courts with long drawn out foreclosures and evictions. I imagine if people refuse to sign on the dotted line, there will be consequences. Like if you make us take you to court to repossess this stuff we both know you're going to lose, you can say goodbye to benevolence and go live in a tent somewhere.
It's funny how people think we're headed toward socialism, when in fact the prevalent threat is feudalism. I will actually be surprised if even longstanding public institutions like education and parks continue to be government run. The government will be facing the debt crisis along with everyone else, so how will they maintain ownership of these institutions, much less continue to fund them? All the property is owned by the banks. Hell, even the post office will probably end up with them. Most likely law enforcement, too. The government will likely be unable to fund public services like police, meaning the banks will likely form their own private security companies to patrol their company towns.
ETA: Oh, and don't be looking to the government for gun control, either. I can just about guarantee that a big part of living in the bank's company town will be giving up gun rights. The courts have already ruled that corporations can take away your free speech, so you better believe they can make giving up the guns a requirement to live in their housing. Along with all of your religious freedoms, etc. And congress won't have to be bothered to slowly chip away at anything, because they'll be able to do it in one swift move. You'll be amazed how quickly people hand them in when it comes down to that or homelessness and starvation.
Originally Posted by jsbhike
Senior Member
we are headed toward serfdom and not dakine on waves
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