Monday, November 25, 2013
Quantitative easing is not money printing.
It seems people like to fill in the blanks with reasonable assumptions which are variables and not constants unless of course you keep using the same reasonable assumptions over and over until of course you reach the logical conclusion of the reasonable assumption.
The FEDERAL RESERVE was given the banknote issuing monopoly in 1913. Prior to that all the commercial banks in the USA issued their own banknotes.
Making the FEDERAL RESERVE the only source of US Dollar denominated banknotes in the USA that are assets of the FED and due to how the FED is set up with the US Treasury liabilities of the US Government.
The US Federal Government is obligated to support the Federal reserve banknote or it's electronic equivalent.
In 1991 in the USA was where all the economic engineering that began in 1981 set up the conditions to sustain an exponential real estate boom in the USA came to fruition.
1492 was generation A...In 1991 you had generation V, W, and X all in a position to power the real estate boom.
From 1991 to 2005 the real estate boom exponentially inflated by about 11% per year.
The primary dealers...
"Wall Street Journal Europe (2/9/06 p. 20), all of the top ten dealers in the foreign exchange market are also primary dealers, and between them account for almost 73% of foreign exchange trading volume. Arguably, this group's members are the most influential and powerful non-governmental institutions in global financial markets. Group membership changes slowly, with the current list available from the New York Fed"
The primary dealers are at the top of the US and Global commercial banking hierarchy.
Loans they make of credit pulled from the theoretical future to spend in the current present which is the past have two components.
Principal and Interest.
The principal component is created out of thin air and is tied to an asset like a mortgage/death pledge contract which is further tied to consumer income.
Like this...I want to buy a house...I do not have $100,000 but have an income source.
I go to a bank for a loan to buy a house and the bank uses my income and the house I want to create the mortgage contract which becomes an asset.
Used to cover the creation of credit out of thin air.
A house with a retail purchase price of $100,000 + my income = the mortgage asset.
The credit which is ultimately my theoretical future income for the next 25 years is pulled from the future to the past which is the present is the liability.
This is the loan amount of my future income borrowed from the future to spend in the past which is the present.
As I make the payments back of my future income the mortgage asset shrinks and so does the liability...the principal amount of the loan deflates...Or has a half life that exponentially decays over time...
The $100,000 is created out of thin air and the credit/debt/money supply inflates....As I pay it back it exponentially decays or deflates back into thin air over the next 25 years if I just make the minimum payments.
The banks do not really care about this...They make their yield from the Interest portion of the so called loan attached to this.
And in a amortization...the Interest portion of the loan is larger at the start than at the end.
Lets say...$100,000 at 6.448% for 25 years
The payment per month will be $666
The two components at the start are.
The first payment made will shrink the supply of credit/debt/money supply by $136
The Mortgage contract will shrink to $99,864
And the bank will receive $530 profit or yield from this.
Not bad...$530 profit on credit/debt/money created out of thin air.
But close to the end 25 years later the Principal and Interest portion are reversed.
At the 300th month the principal portion is $663 and the bank obtains a profit of $3.52
The Primary dealers sit atop the US and Global banking hierarchy and due to how the Bond markets are set up use the Interest or yield or tax on credit or profit to buy bonds from the FED.
The FED is a middle man between the US Treasury and the Primary dealers who are obligated to buy US Treasuries due to the structure of the US Banking/Treasury system.
"I have completed to-day a very great thing. I have finished the National Bank Act. It will be a blessing to the country long after I am dead."--Salmon P. Chase, Lincoln's Secretary of the Treasury
"Lies and delusions or lies you tell to yourself can outlive liars and the delusional."
"My agency, in promoting the passage of the National Bank Act, was the greatest mistake in my life. It has built up a monopoly which affects every interest in the country. It should be repealed, but before that can be accomplished, the people should be arrayed on one side, and the banks on the other, in a contest such as we have never seen before in this country."--Salmon P. Chase
The FED has no money to buy the bonds...
They use the bonds they are going to buy as collateral to back the inflation of the credit supply by the amount of the bonds.
To get their hands on them so the US Treasury can get their hands on the credit they demand from the total credit supply...The Federal Government borrows from the total credit supply by issuing bonds and exchanges the bonds for credit.
The FED then turns around and sells the bonds to the primary dealers which use their profits from their loan/mortgage origination.
All the credit the FED created to lend to the US Treasurey then returns back into thin air and the FED balance sheet is zeroed...
So you have the bonds dumped into the markets and the US Treasury/US Government owing the final bond holders.
The FED is just a facilitator.
The problem in 2005...was the collapse of the 1991 to 2005 real estate boom in the USA.
The supply of consumers willing and able to sign on the dotted line to sustain this magic trick.
dried up and vanished causing the banking algorithm to be starved for yield.
With no new mortgage creation the magic printing press of prosperity ran out of power.
and the primary dealers ability to buy bonds exponentially decayed until 2008 where the controlled demolition of Lehman brothers took place when the demand for yield became greater than the supply and imploded the US and global banking system.
Basically the primary dealers were supplying a zero to the demand for a 1...When they were required to supply a 1 to the demand for a 1.
So The FED has been playing a magic trick.
The primary dealers are supposed to supply a 1 but can not and keep supplying a zero.
So the FED is holding the bonds on their balance sheet and lending the primary dealers the credit they would usually obtain from selling the bonds that they were buying but can not.
To sustain their continued operation.
Of course as soon as the primary dealers do begin to be profitable again...They will buy the bonds from the FED and all the credit they supply to the FED will return back into thin air from where it came from.
If the FED did not do this...Yield rates would explode upward and implode the credit system.
But yield rates have been powered lower and lower the pat 32 years in the USA...The reason the line signers have run out is because the resources of the USA have run out.
There are no more line signers...the V,W, and X generation pool was all utilized to its maximum potential from 1991-2005...and they are all spent.
all the QE is doing is supplying enough credit to sustain the US and global banking system on borrowed time...a postponement of the inevitable collapse.
In 2008 the 1944 Bretton woods system for the first time since 1944 has show visible signs of collapse.
It was collapsing since 1944 invisibly but the expansion that was visible covered it up.
The inflation of the credit system was greater than the deflation.
Like lets say the inflation rate is 1000% and the deflation rate is 995%...the visible yield rate would be 5%
From 1944 to 2008 the credit supply of the USA was inflating exponentially by around 7.8%
On average...There is an invisible inflation rate...such as the real supply and demand that supports the fake supply and demand which appears as the visible effects you see.
the invisible order sustains the visible chaos which all see and think is Truth...It is a visible fantasy sustained by invisible reality.
In 2008...it became impossible for the USA to supply the demand of the Bretton Woods to sustain it's continued existence...Bretton woods collapsed in 1971?
Proof please...I require more than you all can supply to me to prove to me that Bretton woods does not exist.
According to the original rules of Bretton woods...1944-1971...There was the Wold bank...the IMF and the US Dollar was the made the global trade medium of exchange with all the rest of the currencies of the world fixed to the US Dollar which was fixed to the price of GOLD at 35 US Dollars per ounce.
of course at some point the demand for gold from the USA by the world became greater than the supply of Gold from the USA...The gold standard is like this.
I have a gun to your head...and I demand you supply yes...and if you supply my demand I do not pull the trigger.
from 1944 to 1971 when the world demanded yes from the USA...the USA supplied Yes.
But by 1971...the USA had basically been drained of 35 Dollar per ounce GOLD..
So I say...please USA supply me with one atom of Gold...Or give me what I want or yes or 1.
and the USA did not have anymore GOLD at all...and was forced to supply no or 0.
and I pull the trigger...and bang...you are dead...that is the gold standard rules of the game.
But if that happened in 1971...the USA along with the entire global trade system would have imploded to oblivion and killed off the global population dependant upon the Bretton woods global trade system.
So the rules were changed...and instead of a fixed or static credit system utilized by the dynamic trade system...The fixed system was changed into a broken or dynamic system.
Bretton woods was broken from square one...It just took until 1971 for this invisible reality hidden by the visible fantasy to be revealed when the fantasy could no longer be supplied with the demand for power it required to sustain its visibility in front of the invisible reality.
Like a pole shift...a flip where the invisible reality or Truth becomes visible and the visible fantasy or lie becomes invisible.
All that happened in 1971 was a rule change to sustain the postponement of arrival at the logical conclusion of the reasonable assumption of Bretton woods.
The lie all believe is Truth that all in the global trade system depend upon to supply their demands.
You all are the supply to and the demand of the system.
in 2008 the Bretton woods system began reaching the logical conclusion of the reasonable assumption.
the lie all believe is Truth...began visibly collapsing...the fantasy was replaced with reality.
The purpose of the QE is to keep the credit system from imploding to oblivion in the blink of an eye.
Since that is what it needs to do...but of course all in the system do not want that to happen.
where there is a will there is a way.
Where there is a way and a will...there is a way to survive.
Its basically all just a computerized video game now...but limited...Since the reason the Bretton woods global trade system is visibly collapsing is because the demand by all of you globally upon it since 2008 has been greater than what you all globally can supply.
And the beast is yield starved...and is slowly consuming you all.
From the bottom to the top...and there is no way to stop this process...just slow it down...which is what has been going on since 2008...just a further postponement of arrival at the logical conclusion of the reasonable assumption.
The lie you all believe is Truth is fighting against Truth.
The collapse in the inflation of the credit system is the visible evidence that the lie all believe is Truth is collapsing.
Because you all are demanding more power from the lie than you all are supplying to it to sustain it.
without the QE...the world would have imploded to oblivion by now and there would be no Internet.
all the servers and data centers would have been wiped out by the massive hyperdeflationary potential which the current hyperinflation is fighting against.
The key problem is the source of inflation and deflation are the same.
The inflation you see is sustained by the deflation you do no see or are not aware of.
The visible dictates what you all believe is going on...The invisible dictates the visible.
The net producers of power...the uneducated slaves at the bottom of the hierarchy that the educated slaves or servants of the master system at the top claim are the demand for power...are the supply of real power to the master system...and they are almost spent.
It's why yield rates in the USA and world have been dropping for 32 years now to the absolute zero point.
While the educated net consumers of power at the top are the demand for the real power from the net producers.
The real power is then used to create fake power...Or money/debt credit.
its kind of like this.
A net producer supplies the demand of the top for real power.
Lets say $100 of real power and it is used to create $100 of fake power by the net consumers of power.
and the top supplies the demand of the bottom for compensation.
Of $1 of fake power in exchange for $100 of real power.
the poor slave gets 1$ and the rich master gets $99
The net producers of real power are the fractional reserve or supply to the demand of the net consumers of fake power.
The net producers power the continued existence of the net consumers of power.
The plain and simple fact is the global system has reached maximum potential expansion and the net consumers of inflation are demanding more from the net producers of inflation and the result is the collapse of Bretton woods that has been in progress since 2008...that is a controlled collapse.
all your speculations are just the visible noise by all of you that are yield starved as you are being cut off that is hiding the signal that is cutting you off...which ultimately is all of you.
you all are ignorant of the knowledge of your responsibility since you all think you are irresponsible.
you have been socially engineered to believe the FED is the cause of the effects...but the FED is just an effect of the cause...which is all of the slaves in the master system that supply the demand of the master for power or tribute that is then used by the master to create the servant all of you slave for
This is how monetary/credit systems have operated for all of recorded history as far back as you can look in recorded history.
The 100% of the slaves in the master system supply the demand of the master with power and then the demand of the slaves is supplied.
Those at the bottom in the mud brick pits get the minimum wage to supply the demand of the maximum wages at the top.
When the demand from the net consumers of power or the light bulbs becomes greater than the supply from the net producers of power or the power plant...The enlightenment ends and the dark ages begin.
That is what the recorded history of the lie all believe is Truth shows.
Bit coin 1929 and 2013
Posted by HYPERTlGER at 10:05 AM