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The whole financial system is designed to rob value producers and keep them poor. The Fed keeps injecting new fiat money into the economy through loans at very
by cryptica 7y ago
The whole financial system is designed to rob value producers and keep them poor.
The Fed keeps injecting new fiat money into the economy through loans at very low interest rates. A lot of that new money goes towards government bonds which the government uses to pay for expensive government contractors (well-connected people; aka rich people).
The Fed loan money also ends up going to the public via regional banks but this requires the borrower to have collateral; so either way, most of the new fiat money injected into the system goes straight to the rich in the form of cheap loans (so cheap in fact that they're basically free because dividend payments or earnings from just about any asset are higher than the interest rate that they have to pay back).
Then at the same time, the government taxes workers based on their income (not based on wealth); this form of taxation depletes the working classes of any surplus disposable income and as a result, makes it seem like inflation is stable but in reality, because rich people don't pay much income tax (through offshore holdings, etc...), their wealth is silently hyper-inflating. Because rich people can only physically consume so much stuff, this kind of top-inflation doesn't show up in the Consumer Price Index; instead it shows up as increase in the Shiller PE ratio and an increase in the valuation of speculative startups and private equity.
Since fiat money was introduced, the system has been on a death spiral. The more time passes without complete economic failure, the more brittle the system is becoming.