In God We Trust! The Fed – Not So Much….

US dollar "In God We Trust" gold cross concept - In God We Trust! The Fed – Not So Much

Since we went off the gold standard (1971), our currency reads, “Federal Reserve Note.” It’s a paper promise from the Federal Reserve, an independent agency owned by the banks. The value is derived from good faith which is quickly losing ground worldwide.

Flip it over and you see, “In God We Trust.” OK, but…. Trust the Fed? Nope!

The Phony Mission

Bill Bonner’s article, Too Bad About The Public explains:

“In a very private meeting that took place on Jekyll Island, off the coast of Georgia, the financiers – pretending to be on a hunting trip – set up a cartel, the Federal Reserve system. The idea was simple. When times were good, the bankers would earn substantial profits. When times were bad, usually because of their own overreaching, the Fed would bail them out and shift the losses onto the public.

This is just what it did in the Crisis of ’08-’09. The Bernanke Fed extended trillions of dollars worth of new credits to banks that – in an honest system – wouldn’t have gotten a dime.

…. 110 years after the creation of the Fed, most people still believe it is part of the government – which they mistakenly believe voters control. Not so; it is a private cartel, designed to serve the interests of member banks, not the interests of the American public.”

The Fed is totally independent of the government. Fed Chairman Powell recently reminded Congress:

“The Fed has been assigned two goals for monetary policy—maximum employment and stable prices. Our success in delivering on these goals matters a great deal to all Americans.

To support our pursuit of those goals, Congress granted the Fed a substantial degree of independence in our conduct of monetary policy.

…. Our decisions are not subject to reversal by other parts of the government, other than through legislation. This independence both enables and requires us to make our monetary policy decisions without consideration of short-term political matters.

Such independence for a federal agency is and should be rare. In the case of the Fed, independence is essential to our ability to serve the public.

The record shows that independent central banks deliver better economic outcomes.”

What BS!

What record shows better economic outcomes for all Americans? Their track record is abysmal – better for thee, and not for me!

The CPI inflation calculator explains:

The U.S. dollar has lost 97% its value since 1913

$100 in 1913 is equivalent in purchasing power to about $3,134.61 today.

…. This means that today’s prices are 31.35 times as high as average prices since 1913. …. A dollar today only buys 3.190% of what it could buy back then.”

Buying power of 100 dollars over time - 1913-2024Since 1913 the Fed, through inflation, reduced the value of a dollar to a mere $.03. The “economic outcome” benefits the elite at the expense of the people.

Since the Fed’s massive 2008 bank bailout, the numbers are staggering. USA Today reports:

“The top 1% of American earners now control more wealth than the nation’s entire middle class…a group many economists define as the middle 60% of households by income.

Thirty years ago, America’s celebrated middle class commanded twice as much wealth as the upper 1%.

Over the years, the rich have grown steadily richer. The top 1% caught and passed the middle class in collective wealth in late 2020….”

Top 1 percent of US earners now have more wealth than the middle class - ChartWhat happened? President Clinton championed the repeal of the Glass-Steagall Act, allowing banks to consolidate, and merge with high-risk brokerage arms, creating casino banks.

PBS tells us:

“After 12 attempts in 25 years, Congress finally repeals Glass-Steagall, rewarding financial companies for more than 20 years and $300 million worth of lobbying efforts. Supporters hail the change as the long-overdue demise of a Depression-era relic.

…. Just days after the administration agrees to support the repeal, Treasury Secretary Robert Rubin, the former co-chairman of a major Wall Street investment bank, Goldman Sachs, raises eyebrows by accepting a top job at Citigroup as Weill’s chief lieutenant. The previous year, Weill had called Secretary Rubin. …. When Weill told Rubin he had some important news, the secretary reportedly quipped, ‘You’re buying the government?‘”

The “Depression-era relic” worked, no major bank bailouts or failures resulted while it was in force. Since its repeal – nothing but disaster!

WORRIED ABOUT INFLATION?

The Dividend Hunter – Tim Plaehn2023 is shaping up to be the most expensive year ever. The Fed’s response is too little, too late and prices continue to soar!

How do investors protect the value of their nest egg?

How do retirees pay their skyrocketing living costs?

Luckily there’s a proven way for you to stay ahead of inflation, just like 20,000+ investors are doing right now…

Here’s how you can be one of them. Click HERE for more information.

Buying the government?

Wall Street on Parade explains the never-ending banking crises:

Potential bank failure, financial crisis, decrease in investor confidence, economic downturn, bankruptcy concept, Collapse of bank buidling causing dominoes fall on businessman.“Almost 10,000 U.S. Banks Have Disappeared Since 1985, Leaving 4 Mega Banks Controlling 39% of Bank Assets.

The vast majority of the 9,830 banks that have disappeared since 1985 did not fail – they were merged with other banks.

Today, just four banks control $9.3 trillion in consolidated bank assets or 39 percent of all bank assets.

The political clout of these mega banks is such that one of them, JPMorgan Chase, has been allowed to commit a string of felonies and audacious crimes since 2011…and still keep the same Chairman and CEO, Jamie Dimon.

…. (Today) he’s leading the charge…to stop the banks’ federal regulators from imposing higher capital standards on the largest banks with the largest trading and derivative operations to prevent a replay of their crashing the U.S. economy in 2008.

…. By allowing these mega banks to gobble up banks all over the country and stick their logo on thousands of insured-deposit branches across America, Bill Clinton effectively created too-big-to-fail. And because these same handful of banks are dangerously interconnected as counterparties to trillions of dollars in opaque derivatives,…(they are) raising very legitimate concerns of another banking contagion similar to 2008 and 1929.

America got a small taste of how fast bank contagion can spread…last year when the second, third and fourth largest bank failures in U.S. history occurred over the span of seven weeks.

Once again, the Federal Reserve had to rush in with more bailout money for wobbly banks.”

Who’s looking out for ya?

Lord Acton reminds us, The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.

Our government has us involved in wars all over the globe, why aren’t they representing us in a war against the Fed and the banking system? The political clout of the “too big to fail” banks cannot be overlooked.

Banks Make Billions Printing/Lending Money When They Don't Have To Worry About Being Paid Back!Under the guise of minimizing a recession, the Fed cleverly put the banks in a position to blackmail Congress. Congress went on a spending spree, borrowing cheap money to fuel their addiction. Why so cheap? The Fed added over $8 trillion to its balance sheet, creating money out of thin air for the politicians, rather than forcing the government to borrow at free market rates.

FRED - Total Assets Less Eliminations from Consolidation - Wednesday Levels - ChartFinally, the Fed could no longer ignore inflation; the public was up in arms while prices skyrocketed. The Fed raised interest rates back to what used to be considered normal – and began unloading some of their government debt holdings.

“Politicians do not see things when it pays to be blind.”

— Bill Bonner

Meanwhile, Chairman Powell emphasized Congress needs, an adult conversation among elected officials about getting the federal government back on a sustainable fiscal path? Soon 50% of government tax revenue will be needed to just pay interest on the debt. Raising taxes and/or cutting spending is a politician’s nightmare.

Think the banks don’t own the government? Congress refused to pass a bill to audit the Fed, much less curtailing derivative trading or reigning in capital requirements.

Congress is addicted to the Fed’s free money. When asked about the government cutting spending, friend Chuck Butler replied, “Never! The deficit spending has been like crack cocaine to lawmakers; now they’re hooked and keep demanding more!” Addicts do what their supplier tells them to do.

What’s gonna happen?

At the last meeting, the Fed kept rates unchanged while suggesting three rate cuts this year. Lowering interest rates helps the big banks and Wall Street which are now one in the same. The Fed’s implied promise is helping keep stock prices artificially high in an election year.

Inflation is nowhere near the Fed’s 2% target. Wolf Street feels the Fed should NOT be lowering rates:

“Nothing in the Jobs Report Indicates the Fed Should Cut Rates

This Labor Market Is Not Loosening Further: Fed Gets More Reason for Wait-and-See

Resurging Corporate Profits Show Inflationary Pressures Are Reheating after Lull.”

Powell ignored the facts. In early April, Chuck Butler reported:

“Jerome Powell said that the markets should look for lower borrowing costs this year…. That’s Fed speak for ‘Rates are going to get cut.'”

Powell could no longer ignore the obvious:

“Right now, given the strength of the labor market and progress on inflation so far, it’s appropriate to allow restrictive policy further time to work….”

Paul Volcker raised rates well above inflation, then dropped too quickly and inflation soared.

FRED - Inflation Consumer Prices for the United States - Chart

Why don’t I trust the Fed? Their proven track record of protecting bank profits ahead of the people – that’s why. The war between banks and the people continues.

Chuck Butler adds: “Inflation is sticky, and it won’t go away when the Fed doesn’t hike rates high enough to wipe it out, ala Volcker…”

There is a reason gold just set a new all-time high. The Fed is paying lip service to inflation, and it’s not going away any time soon….

A little help goes a long way!

When I started Miller On The Money nine years ago, I vowed to keep our newsletter FREE! I’ve kept my promise.

I agree with Henry Ford’s quote, “Anyone who stops learning is old, whether at twenty or eighty. Anyone who keeps learning stays young.”

Writing and publishing our weekly articles is not only time-consuming and expensive, but also a labor of love. Regardless of our age, we all benefit by keeping our heads in the game.

Why did I choose to keep our letters free? Some readers may be on limited budgets and may benefit the most from our advice.

Several readers urged me to add a donations button. I was reluctant at first, but soon learned it’s doggone exciting when someone pitches in and helps out. Positive feedback for sure. Readers’ kind comments and financial support help offset our cost and keep me going – both financially and emotionally.

Donations are our primary source of financial support; we don’t peddle your name to anyone. I’ve turned down proposals from advertisers, feeling their offerings were inappropriate for our readers. Reader donations are much appreciated, however, it’s strictly voluntary – no pressure – no hassle!

Click the DONATE button below if you’d like to help.

You do not have to sign up for PayPal to use your credit card.

And thank you all!




On The Lighter Side

Last week’s article about stress really hit home. On Friday my son-in-law checked into the ICU with heart issues, Jo went into surgery for a knee replacement and I went to the cancer center for test results and my regular infusion.

Son-in-law is stable and headed back to Vanderbilt for more evaluation. Jo came home the same day and is recovering just fine.

My test showed a new cancer spot in my lung which will be treated with five zaps of radiation. I’ve realized the cancer isn’t going away, but so far we have been able to keep it at bay. Good friend and mentor Chuck Butler has been doing that for over 15 years while enjoying seeing his family grow and prosper. There are times you just count your blessings and be thankful for what we have.

Daughter Holly is amazing; her mom, dad and husband were all in the hospital at the same time – she keeps things in perspective, holds the family together very well, and we are so very proud of her.

Quote of the Week….

banker sitting with a cane“Whoever controls the volume of money in our country is absolute master of all industry and commerce, and when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate.”

— James A. Garfield, 7/12/1881, two weeks before his assassination.

And Finally….

Life long friend Tom G. offers some paraprosdokians; figures of speech in which the latter part of a sentence or phrase is surprising, unexpected and is frequently humorous:

  • Where there’s a will, I want to be in it.
  • The last thing I want to do is hurt you …but it’s still on my list.
  • Since light travels faster than sound, some people appear bright until you hear them speak.
  • If I agreed with you, we’d both be wrong.
  • War does not determine who is right, only who is left.
  • If it weren’t for the gutter, my mind would be homeless.
  • Knowledge, is knowing a tomato is a fruit. Wisdom is not putting it in a fruit salad.
  • To steal ideas from one person is plagiarism. To steal from many is research.
  • I didn’t say it was your fault, I said I was blaming you.
  • Women will never be equal to men until they can walk down the street with a bald head and a beer gut, and still think they are sexy.
  • You do not need a parachute to skydive. You only need a parachute to skydive twice.
  • I used to be indecisive, but now I’m not so sure
  • To be sure of hitting the target, shoot first and call whatever you hit the target.
  • Going to church doesn’t make you a Christian, any more than standing in a garage makes you a car.
  • You’re never too old to learn something stupid.

And my favorite:

  • We never really grow up — we only learn how to act in public.

Until next time…

Dennis Miller

“Economic independence is the foundation of the only sort of freedom worth a damn.” – H. L. Mencken

 

Affiliate Link DisclosureThis post contains affiliate links. If you make a purchase after clicking these links, we will earn a commission that goes to help keep Miller on the Money running. Thank you for your support!

2 comments

  • Schuyler Winter

    I am sorry to hear of your cancer. Blessings and a speed recovery.

    A friend shares your missives, which I look forward to.

    • Dennis Miller

      Hi,

      Sorry, I just got this. Appreciate the concern. As of now, they keep zapping me with radiation and things seem to be under control.
      Best regards,
      Dennis

Leave a Reply

Your email address will not be published. Required fields are marked *