Dandelion Salad
by Rodrigue Tremblay
Global Research, December 18, 2008
“In a crisis, discount and discount heavily.” — Walter Bagehot (1826-1877), British economist
“I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the government at defiance. The issuing power (of money) should be taken away from the banks and restored to the people to whom it properly belongs.” — Thomas Jefferson (1743-1826), 3rd U.S. President.
“By this means [printing money] government may secretly and unobserved, confiscate the wealth of the people, and not one man in a million will detect the theft.” — John Maynard Keynes (1883-1946), British economist
On December 16 (2008), the Bernanke Fed took the most unusual step of lowering the overnight inter-bank lending rate, the federal funds rate, to a level never reached before, i.e. zero percent with an upside limit of 0.25 percent. It also announced that it will buy “large quantities of” mortgage-backed securities and is considering doing the same thing with Treasury bonds of longer maturities, in order to lower the entire yield curve. What it did not say explicitly is that the Fed is ready to debase the U.S. dollar to artificially low levels in order to reflate the U.S. economy. What the Fed wants is to trigger monetary inflation and change deflation expectations at all costs through large-scale debt monetisation and thus floating excess debts in a sea of newly created money.
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