Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
Canadian Cannabis Stocks CRASH as Canopy Growth Hits a Dead End - 14th Dec 19
Retail Sector Isn’t Dead, and These 6% Dividend Paying Stocks Prove It - 14th Dec 19
Top 5 Ways to Add Value to Your Home - 14th Dec 19
Beware Gold Stocks Downside - 13th Dec 19
Fed Says No Interest Rate Hikes In 2020. What About Gold? - 13th Dec 19
The ABC’s of Fiat Money - 13th Dec 19
Why Jo Swinson and the Lib Dems LOST Seats General Election 2019 - Sheffiled Hallam Result - 13th Dec 19
UK General Election 2019 BBC Exit Poll Forecast Accuracy Analysis - 12th Dec 19
Technical Analysis Update: Tadawul All Share Index (TASI) - Saudi Arabia ETF (KSA) - 12th Dec 19
Silver Miners Pinpoint the Precious Metals’ Outlook - 12th Dec 19
How Google Has Become the Worlds Biggest Travel Company - 12th Dec 19
UK Election Seats Forecasts - Tories 326, Labour 241, SNP 40, Lib Dems 17 - 12th Dec 19
UK General Election 2019 Final Seats Per Party Forecast - 12th Dec 19
What UK CPI, RPI INFLATION Forecasts for General Election Result 2019 - 11th Dec 19
Gold ETF Holdings Surge… But Do They Actually Hold Gold? - 11th Dec 19
Gold, Silver Reversals, Lower Prices and Our Precious Profits - 11th Dec 19
Opinion Pollsters, YouGov MRP General Election 2019 Result Seats Forecast - 11th Dec 19
UK General Election Tory and Labour Marginal Seats Analysis, Implied Forecast 2019 - 11th Dec 19
UK General Election 2019 - Tory Seats Forecast Based on GDP Growth - 11th Dec 19
YouGov's MRP Poll Final Tory Seats Forecast Revised Down From 359 to 338, Possibly Lower? - 10th Dec 19
What UK Economy (Average Earnings) Predicts for General Election Results 2019 - 10th Dec 19
Labour vs Tory Manifesto's UK General Election Parliamentary Seats Forecast 2019 - 10th Dec 19
Lumber is about to rally and how to play it with this ETF - 10th Dec 19
Social Mood and Leaders Impact on General Election Forecast 2019 - 9th Dec 19
Long-term Potential for Gold Remains Strong! - 9th Dec 19
Stock and Financial Markets Review - 9th Dec 19
Labour / Tory Manifesto's Impact on UK General Election Seats Forecast 2019 - 9th Dec 19
Tory Seats Forecast 2019 General Election Based on UK House Prices Momentum Analysis - 9th Dec 19
Top Tory Marginal Seats at Risk of Loss to Labour and Lib Dems - Election 2019 - 9th Dec 19
UK House Prices Momentum Tory Seats Forecast General Election 2019 - 8th Dec 19
Why Labour is Set to Lose Sheffield Seats at General Election 2019 - 8th Dec 19
Gold and Silver Opportunity Here Is As Good As It Gets - 8th Dec 19
High Yield Bond and Transports Signal Gold Buy Signal - 8th Dec 19
Gold & Silver Stocks Belie CoT Caution - 8th Dec 19
Will Labour Government Spending Bankrupt Britain? UK Debt and Deficits - 7th Dec 19
Lib Dem Fake Tory Election Leaflets - Sheffield Hallam General Election 2019 - 7th Dec 19
You Should Be Buying Gold Stocks Now - 6th Dec 19
The End of Apple Has Begun - 6th Dec 19
How Much Crude Oil Do You Unknowingly Eat? - 6th Dec 19
Labour vs Tory Manifesto Voter Bribes Impact on UK General Election Forecast - 6th Dec 19
Gold Price Forecast – Has the Recovery Finished? - 6th Dec 19
Precious Metals Ratio Charts - 6th Dec 19
Climate Emergency vs Labour Tree Felling Councils Reality - Sheffield General Election 2019 - 6th Dec 19
What Fake UK Unemployment Statistics Predict for General Election Result 2019 - 6th Dec 19

Market Oracle FREE Newsletter

UK General Election Forecast 2019

Growing Accustomed to Fed Stupidity

Economics / Central Banks May 28, 2009 - 12:28 PM GMT

By: LewRockwell


Richard Daughty writes: I knew that gold was doing okay, but I did not know how well exactly, although I knew that gold bullion was up about 3.5% from this time last year, which is better, and by a long shot, than almost anything else you can name, but which is not, I admit, very much.

So I was feeling a little despondent even though gold has actually given me a paper profit while everything else is in the crapper, and the reason is that I had so desperately hoped that gold, silver and oil would have soared, soared, soared in price by now, financing a blazing, incandescent trail of golf and gluttony across the international landscape.

So I felt better when I read of Doug Noland at his Credit Bubble Bulletin column at calculating that the HUI gold index is up 25.4% year-to-date. Whee.

The explanation is that Total Fed Credit, also known as Federal Reserve Credit, also known as “credit in the banking system that, literally, appears out of thin air,” also known in a Barron’s footnote as “Fed supply of permanent reserves provided,” jumped a staggering $48.6 billion last week, an amount so freakishly excessive that former Fed chairman Alan Greenspan – at his worst – would take almost five months to accomplish the same feat.

Quizzical Mogambo Scholars (QMS) must be abuzz as they note with alarm the lack of at least one exclamation point at the end of any of those terrifying sentences, and they must marvel at the use of mere periods as expressionless punctuation, which indicates to me how I am getting “used to” such Federal Reserve extravagances, or maybe that some of those new pills are working, or maybe that my wife or kids are putting poison in my food, or perhaps that the CIA is shooting some kind of ray gun at my head, beaming some new emotion-damping, thought-controlling rays right through my protective aluminum-foil hat and deep, deep into my brain, probably with the help of one of my angry neighbors, all of whom I thought would be HAPPY to learn that they were complete idiots not to be buying gold, silver and oil when their idiotic Leftist government is acting so irresponsibly and the corrupt Federal Reserve is heinously creating the excessive amounts of money to pay for it all, and it is that kind of utter stupidity on their part that explains why they have been laid off from their stupid jobs and why their children similarly behave like brain-damaged mutants!

Suddenly, a cry rings out, “Look! Exclamation points are back to express, among other things, scorn and contempt! And fear! Lots and lots of raw fear!”

Whatever the reason, in total, the Federal Reserve has issued (since the inception of the Federal Reserve when it was tragically born alive in 1913, spewing as it did out of the very cesspool of hell), $2.165 trillion in credit to the banks, of which (and I warn you to sit down and hold onto something before proceeding), a whopping $1.293 trillion appeared in the last twelve months! Gaaahhh! Twelve Freaking Months (TFM)! We are so doomed by the idiots in charge! Hahaha!

In that selfsame heroic “laughing in the face of death” bon vivant attitude, I note that the Federal Reserve is a bunch of secretive banker trash who have taken over the US government, and who actually now have a “dot gov” suffix to their Internet address, when in fact they are not connected with the government at all, but are, instead (referring back to the beginning of the sentence) a bunch of secretive banker trash who have taken over the US government and have ruined everything with their corruption and greed.

Oops! That is not what I wanted to talk about! Sorry! What I meant to say that I also heroically “laugh in the face of death” at the fact that the Federal Reserve bought $59 billion in US government Securities for itself last week! Wow!

No wonder nobody wants to trust the US dollar! Hahaha! This is the ultimate fraud! The government lets the bank create the money to buy government debt that the bank buys for itself!

And it is a tragic fact of life that all of this new money will necessarily lead to inflation in prices, and I am happy to see that people are starting to understand how they should own gold, as I gather from the Lipper Indexes showing that it has gained more than almost anything else you can name, which is kind of what you would expect from the future price inflation inherent in federal deficit-spending $2 trillion in a $14 trillion economy, or in the CRB index being up about 6.3% since January, which seems to be a lot in a country where inflation is supposed to be quiet, tame, non-existent, benign, under control, nothing to worry about, don’t call here again, we don’t care what you say, I mean it.

And this is not to mention how the Goldman Sachs Commodities Index is up 20 percent year-to-date, too.

Knowing that, you are thus ready to understand, in all its complex subtleties, when I say for you to buy gold, silver and oil because “Whee! This investing stuff is easy!”

May 28, 2009

Richard Daughty (Mogambo Guru) is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the writer/publisher of the Mogambo Guru economic newsletter, an avocational exercise to better heap disrespect on those who desperately deserve it. The Mogambo Guru is quoted frequently in Barron’s, The Daily Reckoning, and other fine publications.

Copyright © 2009 Daily Reckoning

    © 2009 Copyright - All Rights Reserved
    Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


29 May 09, 08:02
You get what you give

Ah Mogambo, your cynicism is completely unwarranted. Just look at all the good things the Fed has done for the US:

OK, well at least all the bankers are happy, admittedly a small chunk of the population nut a bit chunk of the wealth, and that has gotta be a good thing that a large chunk of the wealthy are happy...

As to the serfs (the other 98%), those suckers got what they voted for, "change you can count on", so everyone's a winner.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules