Our new section, "Members' Corner," is ready to host your thoughts, comments, and articles for discussion with your friends at PSW. All topics welcome (and you don't have to be a Nattering Naybob to contribute). Please send your submissions to me at "ilenecapsw" at gmail. ~ Ilene
Courtesy of The Nattering Naybob.
"the Fed has been attempting greater and greater redistribution efforts via monetary interference ever since Solow and Samuelson predicted their disastrous "exploitable" Phillips Curve. " Fix The Error – Jeffrey P. Snider
As we Nattered before, the Fed, since Greenspan, by inserting itself as a governing influence in markets, has done what was once taboo, affect markets for policy reasons. Consequently, the Fed has made decisions based upon what is now, due to their own interference or lack of transparency, a tainted or bad signal. All that flows from the fruit of the poisonous tree (bad sensor, corrupted telemetry signal) can yield nothing short of erroneous decision making and result in systemic misguidance.
"Redistribution predicated upon the increasingly bizarre begins to describe our economic deficiency quite well, I think; including the growing unease about having another recession without ever finding recovery from the last great one."
Spot on.
"Our future is continuously bleak as central bankers cling with religious devotion to increasingly absurd redistribution schemes, or to fix the error – them."
And "they" won't fix anything, as it is not in their best interest to do so. Simply put, their sponsor's business models are predicated upon keeping the sheeple IN the markets. If rates were to revert to the mean, one could go to a bank and get a CD paying say 4-8%, and they would. Those resulting deposits MIGHT then be lent into the emasculated and outsourced economy, which then MIGHT recover.
It's not capitalism if capital does not flow… hence, the "money" or potential capital is forced into the rehypothecated ponzi scheme or casino of speculation in equities, bonds and commodities. Resulting in artificial bubbles, the inability for true price discovery, and a lack of real economic activity lending, turnover (velocity) and creation of new "money". Stagflation is what we truly suffer.
Lacking for a complete implosion of credit liquidity, along with the popping of all asset bubbles, bond, equity, RE, etc. i.e. a systemic reset, the ubiquitous "they" will and can keep rates at or near ZIRP for too many obvious reasons to explain. Unfortunately, perpetuation of the absurd, perverted and unnatural is the order of the day as this is not a strategy of value creation, but one of value extraction working as intended in all its "glory."
