Federal Reserve Bank Chairman Declares Looming Economic Destruction Due To Debt

The current Federal Reserve Bank Chairman Jerome Powell has said in a report published on Bloomberg that the current problems with finances could lead to greater debt issues that could cause long-term, serious destruction to the US economy.

The U.S. economy faces unprecedented risks from the coronavirus if fiscal and monetary policy makers don’t rise to the challenge, Federal Reserve Chair Jerome Powell said while pushing back against the notion of deploying negative interest rates.

“The recovery may take some time to gather momentum, and the passage of time can turn liquidity problems into solvency problems,” Powell said Wednesday in remarks to a virtual event hosted by the Peterson Institute for International Economics in Washington. “Additional fiscal support could be costly, but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery.”

Powell and his colleagues on the policy-setting Federal Open Market Committee have taken dramatic measures to shelter the U.S. economy during the coronavirus pandemic. They have cut their benchmark interest rate to nearly zero, engaged in open-ended bond buying and begun rolling out emergency lending programs as U.S. unemployment has soared to levels not seen since the 1930s Great Depression. (source)

There is going to be no economic recovery.

All of this is a shell game with debt. If people can’t spend money because they have none or cannot get access to it, making loans stops. When loanmaking stops, money is not printed, and when money is not printed, the ponzi scheme upon which the economy is based stops. It’s a house of cards that will crash.

The last sixty years- and arguably the last century -of monetary policy has been financial trickery to keep the image of wealth and value afloat while extracting as much as possible as far as real assets are concerned. This can only endure for so long before the entire system must fall apart, like any scam eventually does.

COVID-19 was the tool that caused exactly that to happen. It exposed, by force, the corruption of the financial system and made it such that the economy cannot likely recover because of money printing.

There are only two scenarios left. Either a long-term deflationary depression, or hyperinflation, the latter being more likely than the former.

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