The global economy seems to be heading towards a financial crisis fueled by central planners that could devastate markets around the world. This year, observers are witnessing the greater synchronization of central banks printing massive amounts of fiat or participating in other forms of stimulus. Central bank easing has not been as dramatic in almost two decades, with the M1 money supply having reached an all-time high.
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Central banks continue to fight the fires they triggered
Central banks continue to print huge amounts of fiat, lower rates and do everything in their power to limit the devastating consequences of poor central planning. In 2019, the number of developed central banks reinforcing their easing policies makes it a concerted effort on a large scale. For example, nearly twenty central banks play roulette while manipulating the global economy in different ways. At first, when the gloomy economic forecasts began to become a serious topic, banks simply began to cut interest rates. A large number of institutions from regions like Japan had already reduced interest rates and introduced negative rates.
The Federal Reserve fails to meet its obligations if it does not lower the rate and, ideally, does not stimulate. Take a look around the world on our competitors. Germany and other countries are being paid to borrow money. The Fed was too fast to increase and much too slow to reduce!
– Donald J. Trump (@realDonaldTrump) October 24, 2019
The Federal Reserve has cut rates for the first time this summer since the economic crisis of 2008 and lowered them further in September. Despite the influx of $ 60 billion a month and day-to-day pensions, US President Donald Trump still thinks the Fed could do better. All banks cite rising inflation and lack of liquidity while being surprised by the deep economic crisis. For example, on October 24, the Ukrainian central bank lowered its rates by 100 basis points. The Ukrainian Monetary Policy Committee concluded that the "inflationary pressures" were too great and agreed to relax them.
The following day, October 25, the European Central Bank (ECB) and the People's Bank of China (PBoC) concluded a bilateral currency exchange agreement. The ECB and the PBoC participated in various easing processes this year and explained that the bilateral exchange of foreign exchange was aimed at strengthening foreign exchange and capital markets. This agreement is the second three-year extension and the first agreement was drafted in 2013. Following the launch of massive synchronized easing efforts worldwide, JP Morgan's strategists have written a research note telling investors that they should expect more monetary easing policies in the future. . "The evolution of the macroeconomic outlook, the risk of overflow from the business sector to the household sector or the manufacturing sector to services deserve some caution, particularly in the context of the continuing risks of the trade war and Brexit, with the US presidential election later in the evening. year, "said analyst JP Morgan.
As the era of the central bank crumbles, freedom and free market solutions will prevail
Sven Henrich, the founder of Northmantrader.com, a blog on macroeconomics and technical analysis, said this week that the money supply of the M1 had peaked unprecedented and the Federal Reserve "continues to run in circles." We can all speculate on who and how, but we can note that the money supply of M1 has suddenly collided with a strong expansion when equities have problems … The expansion since 2009 compared to the historical execution rate was breathtaking, "Henrich said. "This is perhaps the biggest under-reported and undisclosed issue on the market. I can not pretend to understand all this, but I am curious to know why the money supply has been multiplied by 4 since 2000 and almost stable for years between 2004 and 2008, and this since 2009 only. :
Yet, they say there is not enough money for day-to-day funding and that's why they make pensions?
On October 28, at the Litecoin Summit in Las Vegas, Ron Paul, a retired US state man, told the crowd that the era of the central bank was collapsing and that solutions Free markets such as precious metals and cryptocurrencies opened the way to freedom. "Freedom is the answer to so many of our problems – freedom does not divide, the government can not intervene and fix the problem," said Paul. "People have to get together and work together." The former presidential candidate added:
The American empire is in its last stage: the situation will be difficult.
While all the banks are working together to fix what they have started, many economists believe that they will fail again. Since the 16th century, central banks have increased the amount of money in order to cope with rising prices for goods and services. The increase in the money supply has finally reduced the purchasing power of the citizen through a legal offer issued by the central banks. In 1958, Ludwig Von Mises' conference, entitled "Economic Policy: Reflections for Today and Tomorrow," showed how much the bureaucrats believed wholeheartedly "that bankers had secret knowledge to produce wealth at home. from scratch".
Instead, politicians and central bankers have caused rapid inflation, divided the world's citizens with a class war and continue to fund the military-industrial complex with no end in sight. In Ron Paul's book "End the Fed", the words of the former senator will forever be engraved in the minds of young people struggling for more freedom. "It is not a coincidence that the century of total war coincided with the century of the central bank," wrote Paul at the time. So far, Paul and many other economists have been right about the fraudulent actions of the central bank, but no one really knows if they can go on for a long time.
What do you think of the large-scale easing efforts that central banks are currently advocating? Do you think they're digging a bigger hole? Tell us what you think about this topic in the comments section below.
Image credits: Shutterstock, Twitter, Sven Henrich, Fred, Fair Use and Pixabay.
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