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Yes, Washington, we are in a Depression!

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(Originally published July, 2008)

“All the factors which make for a quick and speedy industrial and economic recovery are present and evident. The Federal Reserve System is operating, serving as a barrier against financial demoralization. Within a few months industrial conditions will become normal, confidence and stabilization in industry and finance will be restored.” William Green, AFL-CIO, November 22, 1929

(The National Bureau of Economic Research declared the current “recession” which began in December 2007 is over. Really?)

So I now read that the Federal Reserve is unveiling “new” rules supposedly aimed at protecting us. Of course, they say nothing about the U.S. Dollar losing almost 100% of its value since 1913.

Officially, no we are not in a recession. The economy is not in recession until a panel at a private institution called the National Bureau of Economic Research says so.  Unofficially, many economists think a recession started six or seven months ago, even as the economy has continued to expand — albeit at a tepid pace.

Basic economics (something they didn’t teach in school) tells us that the more there is of a good, the less valuable it becomes. This is also true of money. The dollar is worth four cents of what it was when the Federal Reserve was created in 1913.

For example, a house that costs around $150,000 today would have sold in the range of $7,000-$8,000 in 1913. Either Ben Bernanke is a clueless nitwit or really evil depending on his state of mind.

The Federal Reserve creates inflation when it issues US dollars backed by government debt otherwise known as “fractional reserve banking”. The more “money” the Federal Reserve creates – the less your Federal Reserve “money” will buy.

From 1913 to 2001 the national debt grew to $6 trillion. Over the next three years it increased to $7 trillion dollars. In the following year it increased sharply to over $8 trillion dollars. The national debt is now well over $9 trillion dollars! (A little over two years later, it stands at around $13.5 trillion).

Let’s face it people. The Federal Reserve as well as the legislative branch (Congress) and the executive branch (President) are all responsible for this current mess as well as past and inevitably future bubbles and collapses. The ‘Fed’ does not stabilize the economy. If so, why did the Great Depression among other economic calamities occur on their watch? Something to think about.

Written by chrisforliberty

September 21, 2010 at 11:43 am

Posted in Banking/Money

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