The Conspiracy of the Federal Reserve Bank, Trump Knows Nothing

 I posted this comment at Business Insider in answer to Trump, who mistakenly said the Fed keeps interest rates low for Obama:

The Fed could care less about Obama. The Fed cares about the banks because it is a bank, a private bank according to a ruling in 1982, Lewis VS the USA. And the banks can't survive without low interest rates because Greenspan expanded the derivatives system. This system is the real evil behind deregulation. I wrote about it here:
The Fed is a conspiracy. It conspires to make the economy grow slowly. The reason it does so is that low interest rates are built into the system it has built. I proved this on Talkmarkets.

The Fed is socialism for the banks, and it is a conspiracy. This is how they do it. They keep the economy from growing properly. They make it grow slow. Then the Republicans are mad that so many people are dependent on the government. The Fed really is not the government, but is a private bank. It is beholden to the banks, not the people. It is determined to keep interest rates low and slow money turn over (velocity). The Fed PREDISPOSES low interest rates and thus can't let the economy heat up. Here are the 4 ways they do it. From the article I wrote:

So, we need to look at the ways in which the Fed has set things up to predispose it to keep rates low.

1. Grumpy's friend says the Fed can't afford to pay the treasury interest if rates are significantly raised. That is almost a hostage situation.

2. The banks have bet on low rates, taking the floating low side of the swaps bet when they issue loans.

3. The Fed pays interest on the excess reserves in order to restrain lending.

4. Long bonds are in massive demand as collateral, the new gold, and there are shortages, even with BRICS nations selling into a deep market.

So, rates are predisposed to stay low barring some unforeseen circumstance.

So,Iwog, Greenspan saw the implosion of the S&L's and vowed never to let that happen again. He is the primary architect of a system doomed to low long bond interest rates and a hollowing out of the US economy. Yes, the Fed can control long rates by predisposing them to stay low in all the actions they take. They can't control long rates by manipulating the Fed Funds Rate.


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