The Balance Sheet
Two main points for those who are in a hurry. If the stock market wasn’t a scam, it wouldn’t need taxpayer dollars, and the Fed buying bonds is not a valid remedy to an economic emergency. It is business as usual for the extraction scam.
Dumping taxpayer money into the market does not pay the bills. It doesn’t help the real economy. It simply makes more money for those with enough money to invest. They might buy some high priced corporate products or a few luxury items, but that’s not going to save the economy.
The ongoing economic emergency, caused by state governments shutting down businesses, due to the coronavirus, is remedied only by providing money directly to the economy where people work.
The stimulus money is necessary for workers because most live paycheck to paycheck. They will spend the money paying bills, investors won’t. So why spend the lions-share of stimulus money buying overpriced market junk?
The policy assumes luxury items are more important than paying bills, which shows you the policy benefits those that write it, not the people who need it.
The balance sheet describes the ability of the Fed to commit an officially sanctioned accounting fraud. They have to put the bad debt from their false profits into a fake column on their ledger sheet to reconcile our increasing inequality, with taxpayer bailouts.
The balance sheet is a bottomless pit of fraudulent profits from other people’s money. It’s like saying I’m going to take your money but as you earn more the amount I took from you will be a smaller percentage of what you have, when you do finally earn it. So it all works out.
Oh, and by the way, I will need more before the percentage of what I took from you will be any less, so you can just owe me the difference on that. You can pay me the balance after you earn it.
That’s cool, right?
Without the black hole of taxpayer guaranteed off-the-books debt made possible by the balance sheet of the fed, there would be no billionaires. Society would be forced into an economic rethink, which is long overdue. Someday society will conclude a public profit bank was the solution to our funding problems all along. The balance sheet was just a way to maximize the extraction of money from the public.
The balance sheet enables massive inequality. Alternatively it could end poverty, but it doesn’t. Our government prefers the “trickle-down” approach to economic growth, which creates more inequality.
Poverty is an intentional policy that could be changed.
Increasing inequality by Fed policy not only makes most people more poor through inflation, it also makes some people very rich, who have too much “influence” over our government.
Private interests control public policy because of inequality.
As the inequality increases the middle class disappears along with the ability for a credible democracy. The necessary democratic reforms are self evident. We need to restore the balance in our economy to even have a democracy.
This is how we do the trickle down;
Ya see, I borrow money from your future for myself to spend now, and while I spend it you will get some of it too, by working for me. And when you work long enough the economy will grow and then you can pay me back for the money I borrowed from you last time. See how that works?
That’s cool, right?
We need democratic reforms to reduce inequality, but inequality is a major obstacle towards democratic reforms. There’s a problem.
So I spent some time reading about the emergency lending facilities of the fed and the need for commercial paper, and the CPFF, etc. It all left me with a bad case of confirmation bias. What a scam. The policy serves inequality.
The government taxes the public to profit shareholders.
Instead of taxing dividends properly, we borrow and spend which has compounded the inequality for decades. The result is market profits must now be guaranteed by the taxpayer to keep investors borrowing more money to invest in the scam.
The public has been squeezed like the proverbial turnip, so now the Fed needs to print money for further investor prosperity. The gold standard was originated, in part, to prevent this behavior and the economic instability that is sure to follow.
Counterfeiting corrupts the entire economy. The extraction scam is a shell game of fraudulent profits. Unlimited money is now available enabled by the Fed’s “balance sheet”. The Fed loans out unappropriated tax dollars for private profit, guaranteed by the taxpayers. How is that legal?
The Fed published a video to explain how it works:
Their video rationalizing the taxpayers buying bad debt for investor confidence is a perfect example of Academentia. It’s a self-validating word salad of nonsensical justification. We all just naturally assume this is our only choice because it is explained so professionally, regardless of what was being said.
Investors are reluctant to buy stocks, they say, because they might decrease in value. So the taxpayer will now “backstop” investor losses with borrowed money, if necessary, to insure investor confidence.
You have got to be kidding me.
Because investors depend on the continued dividends they got over the last four decades, from this scam, we will now insure their investments like we insure jobs and provide a kind of “unemployment insurance" for working capital. If the markets fail to deliver enough profits to the investors, don't worry, the taxpayers will cover it.
Here’s a quote from Investopedia;
"Unlike any other business enterprise, the Fed can expand its balance sheet by printing as many dollar bills as it wants. It's like creating winds merely by waving your hands.”
It’s no wonder with such god-like powers to create money from thin air their community is saturated with billionaires. Nation-states are subservient to their money now, which is the real representation the public seeks, not politicians. Politicians are forced into an economic obedience with the scammers, instead of serving the public.
Private money must be removed from our political system to prevent undue influence and corruption.
We now have a global community that can control governments by supplying them with, or depriving them of, the money they need to conduct adequate commerce.
Those who have preached decentralization have created a global system of centralized power based on non-collateralized debt, which is counterfeiting money. That is the system that must be reversed in order to achieve a democracy and prevent the national demise.
Money currently serves as a hierarchy of political authority. How do you compete politically against an adversary with unlimited money?
Money should be recognized as representation, because it is, and we should apportion congressional delegations accordingly, based on the populations income, which is more relevant than where they live.
Tax-bracket apportionment or something similar appears to be the only political reform significant enough to remedy our current social and political dysfunction.
If we fail to reform our economic system, we are all just specs of dust beneath the fingernails of the gods who create money from thin air.
That is not a democracy.
I included the video clip with Bannon to show the balance sheet has been about the same since the last financial extraction. It doesn’t get paid back. The balance sheet merely serves as a buffer for the extraction scam, to add more leverage and hedge when overextending the bad debt piled on to the full faith and credit of the uninvested taxpayers. That gives investors confidence the scam still works so they will continue to pump their ‘winnings’ back into the global Ponzi scheme.