The real reason why the US Central Bankers cannot raise interest rates can traced back to eight simple words – their response to the 2008 global financial crisis. US Central Bankers reached a crossroad of responsibility versus socialism for the über wealthy years before the 2008 financial crisis manifested, and they chose socialism for the über wealthy as could be expected, because Central Bankers have to somewhat appease the highest echelons of global wealth if they don’t want this class to turn their resources against them and argue for the dissolution of Central Banks. When Central Bankers, both in the US and in Europe, deliberately and very consciously chose the path of catering to the few thousands that constitute the class of the über wealthy over helping the remaining 6.8 billion people on planet Earth in 2008, they sealed the fate of what their decisions had to be some ten years later.
During 2008, all of the largest European banks and US banks were completely bankrupt. To this day, I know that claim is disputed even though Finance Ministers that had privy to this data, like Greece’s Yanis Varoufakis, have made such claims. Furthermore, any reasonable person that looked more deeply into the financial health of all major US and European banks, the failure of which triggered the 2008 global financial crisis, would have understood that their unwillingness to operate as banks, but as massive hedge funds and to risk their clients’ deposits in hopes of making billions of profits every year, would have realized that regulatory agencies that suspended the necessity of banks marking their financial assets to market value was enacted to allow banks to lie about their bankrupt status and project a robustness in financial health that simply did not exist. Secondly, anyone that looked into the original bank recapitalization number of $700M in free money to the banks, both American and European, would have noted that a US Treasury spokesperson stated, when asked about how the $700M recapitalization amount was determined, “It’s not based on any particular data point. We just wanted to choose a really large number” – a statement that revealed that even the US Treasury at the time of the Lehman Brothers, Bear Stearns and Merrill Lynch failures, really had no idea how deep the rot in the banking industry had penetrated. And by the way, later official US government documents noted in 2011, that the US Central Banks had given trillions of dollars, not just $700M as originally stated, to US and European banks to save them from bankruptcy. It would be ludicrous to argue that these banks just took trillions of dollars of free money for no purpose whatsoever. Of course, the real reason that US Central Bankers gave them trillions was to keep the biggest banks in the world from all going belly up. And this monetary policy of socialism for the bankers enacted more than a decade ago is a major factor why Central Bankers cannot raise interest rates today.
Now there are two reasons today why US bankers can still even trigger the endless debates that consume mainstream financial media that predict their future behavior even though Central Bankers cannot raise interest rates. If you understand the opening paragraph of this article, there simply is no future behavior to predict, because their future behavior in years 2020 and beyond was already set in stone years before 2008. The endless articles about US and EU Central Bankers “losing what little credibility they have left” or arguing whether former Goldman Sachs lackey and current ECB President Mario Draghi or US Central Bank Chairman Jerome Powell are “liars” or “fools” regarding their decisions are comical in the nature of their speculation.
The reason such articles are written is simply because a forwarded mainstream narrative and belief exists, antithetical to reality, that Central Bankers are trying to enact policy to help the economies of the nations in which they operate. We only need look at the job Mario Draghi did as the Governor of the Bank of Italy from 2005 to 2011, when Italy’s banks were among the financially most insolvent of all banks in the EU, to understand Draghi’s purpose as the President of the ECB. Furthermore, during this time, there were always leaks of policy maneuvers in which it was publicly stated that the Bank of Italy would sell down its gold reserves to help pay off its sizeable national debt, after which gold prices always plunged, and after which the Bank of Italy never sold any gold. It would not surprise me one bit of Mario Draghi was responsible for these manufactured and disseminated lies about Bank of Italy gold sales that never happened as well.
Furthermore, once one realizes that the US dollar, despite continual propaganda from the MSM that the US dollar is “strong” today, has lost more than 98.5% of its purchasing power since the inception of the US Central Bank little more than 100 years ago, it is quite basic to understand that their end goal is to destroy the US dollar completely. Consequently, the fact that they are successfully carrying out their mission gives them credibility, not makes them lose credibility, once one understands with clarity, their purpose. Likewise, there would be no debate as to whether any Central Banker, governor, member of the board, Chairman or President, was a “fool” or “liar” if they state anything publicly that opposes their real mission – it would be obvious that they were lying.
Even though there should be no debate about the intent of Central Banker’s actions and public statements, and no opposition to the claim that the US Central Bankers cannot raise interest rates, there are two reasons why their actions and press releases always trigger such enormous debate regarding their meaning. Number one, Central Bankers control the sphere of academics so anyone that learns about money and banking in traditional forums of academic classroom, and relies on this knowledge to interpret Central Banker actions and statements do so through a lens that will never grant them clarity. Secondly, Central Bankers, are the gatekeepers, much like music producers like Detail and film producers like Harvey Weinstein were the gatekeepers of the music and film industries, of the banking world, and despite reprehensible gatekeeper behavior, still were able to convince people at the highest echelons of their industry who were very aware of their reprehensible behavior to shamelessly and publicly fawn over them. Academics do not rise through the ranks of Princeton, Harvard and various departments of the Treasury without gatekeeper approval, and thus the talking heads that constantly appear on mainstream financial talk shows have been branded with the highest level of loyalty to Central Banker narratives possible.
Thus the level of brainwashing about Central Banks and their purpose has been so widespread and integrated into society at such a high level that former Central Bankers like Alan Blinder can state, “the last duty of a Central Banker is to tell the public the truth”, openly warning us that Central Bankers will lie as their standard modus operandus when publicly speaking about monetary policy, yet still have talking heads on television regularly debate the meaning of a Central Banker’s words. The level of brainwashing is so deep that even though Blinder made his infamous statement in 1994, more than a quarter of a century ago, like fools, we still argue today over whether we are receiving the truth about Central Banker plans every time they issue a statement.
In fact, as a testament to our level of brainwashing, current Secretary of State Mike Pompeo admitted earlier this year, “I was a CIA director, we lied, we cheated we stole… like, we had entire training courses [on how to do this]”. And this is the type of men that Heads of State gladly appoint to some of the most critical positions in their cabinets and refer to as a “fantastic” man. When I was a teenager, the CIA would still lie, cheat and steal, but in the process of doing so, tell us that they were giving us facts and truth, acting honorably and gifting us items. Today, I believe that men like Pompeo have no fear of openly admitted such questionable behavior because of the fact that their process of brainwashing has been so complete that he knows the majority of people will not even care about such a statement.
Please follow this link to subscribe to our new maalamalama YouTube channel, where I will post the full 25:00 minute video about this topic later this week. As long as you subscribe and also click on the notification bell, you will receive a notification as soon as the full video is uploaded within the next few business days.
The video, which will be titled, “The Real Reason US Central Bankers Cannot Raise Interest Rates in 2019”, will also discuss the following topics:
- US President Nixon’s to end the gold backing of the US dollar and Bretton Woods in 1971 and the impact of this decision today on the US dollar
- Why understanding the massive differences between Paul Volcker’s US Central Bank’s decisions and Jerome Powell’s US Central Bank’s decisions, under similar US dollar circumstances, is critical to understanding what is going to happen in the next three to five years.
- How today’s asset price behavior in commodity and stock markets have been completely and forever altered (for the worse) by bankers’ executions of artificial intelligence algorithmic trading software.
- How the US dollar rising last Wednesday on news of a US Central Banker fed funds interest rate cut is similar to the violation of an immutable law, like “two objects cannot occupy the same space at the same time”, and why this near guarantees disastrous consequences from Central Banker measures in our future.
One of the most interesting sentiments I’ve discovered this year is the following. Generally speaking, including even professionals that currently work in the financial industry, people are extremely complacent about a dangerous situation that should demand their meticulous tracking and proactive action – the inevitable collapse of the Central Banker created Bubble of Everything. In fact, I liken people’s lack of concern to the current precariously distorted nature of high global asset prices in various markets to the same lack of concern they expressed to my warning of a collapse in the US stock market that preceded the 2008 US stock market crash by only 18 trading days. However, whereas recovery was possible from the last crash, the magnitude and length of the upcoming crash, when it occurs, whether in the form of a melt up or meltdown, will likely be multiple times more devastating than the prior one. Subscribe to our free weekly newsletter here and support as by becoming a patron here!
About the author: J. Kim is the founder and Managing Director of skwealthacademy, a decade long passion project that is comprised of a complete online academy of 20 courses that specifically address 9 identified pillars of education absent in modern academic classrooms today. All articles such as this one are only possible because of the support of our patrons, so many blessings to all new and future patrons that support us. Please consider becoming a patron, as our patrons keep our blog and articles free.
Among the elements critical to education, largely absent from academic classrooms, that we are intent on returning to the educational process through our online skwealthacademy are (1) an immediate restoration of critical thinking development, (2) an immediate return to corporate ethics that is now largely absent in the largest corporations in the world; (3) understanding of the differences between unsound fiat currencies and sound money, and how this misunderstanding contributes to the persistence of many of the world’s great suffering in the form of global poverty and hunger; and (4) the identification of life purpose to replace widespread materialistic pursuits that have created and spread elevated levels of anxiety, depression and opioid dependence.
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