Fed Reserve Fails to Reflate the US Banking System

[makeiteasyable]

good info .

[HaveAGingerAle]

um - I like this video - but as for the end - central bankers know EXACTLY what they are doing!

[x11115]

I don't like what the government is doing by increasing the debt - they have done a horrible job and will eventually bankrupt the country / people. But you can't say money isn't what it's worth in 1929 because there was also a population boom and when there's more people there has to be more money to go around. Make sense? More people = less resources = less value no matter how you look at it. So if you equally divide everything of value and there are suddenly 10x more people to divide by -$

[FordPintoRed]

New World Order mentioned 1967 film

watch?v=GPB98MC3PVo

[stang661]

Great thing is giant banks will never fail and never have to perform. No need for big bankers to even try. Just get on that federal welfare.

[romanianskill]

Fake... you can see the strings

[mandatum1979]

Holy crap!

[methoseous]

usa and the world should do what canada did to their banks long ago. we got the #1 banking system int the world right now :)

we dont even got a recession. we only lost steel jobs and car jobs thats it. we are stable.

the united states should do the same

[amleko]

Its a graph of "emergency" credit that Banks who are in trouble can get courtesy of the Fed. Kinda like mooching $4 from your Rich Uncle when your in a pinch. You can go to the research.stlousfed.orgwebsite to see.

[djtakagi]

what is this a graph of??? money supply? it does not look quite right. is m2 really that bad? I remember looking up some graphs but it wasn't that bad -- but still bad enough. anyway its about time we audit the fed! maybe get rid of them.

[BoxGuy1951]

dj- Maybe get rid of them ? Thats EXACTLY what is necessary ! Consider this for a remedy to our present day financial " crisis ". End the Feds role in governmental banking & audit it ASAP to determine its past errors & who benefitted from them. Consider our present debt as " A Wash " . Paid in full ! Pull out of both wars & close half our worldwide bases ! Deport ALL illegal aliens ASAP including ALL anchor babies. All of a sudden we look healthy again dont we? In the black about 14 trillion !

[Rofocales]

So inflation wise in the 1930s $1 dollar is around $13 dollars today, so no more than $16 billion was borrowed. In the 1980s inflation wise it's around 2.5x. Correct me if I'm wrong as I'm a bit out of it today, but @ our peak, including inflation, no more than around 30ish billion (being generous) has ever been borrowed before.

[itulipdotcom]

That is correct, $30 billion max in 2008 dollars previous borrowing vs $700 billion 2008 dollars in 2008. If you inflation adjust the scale appears the same, so does not add anything to our point, plus this way we get to use the Fed's own charts. (They do not inflation-adjust.)

[Rofocales]

The great fall of the 21st century paradoxically has a beautiful soundtrack.

[gigglybeast]

Yawn. Adjusted for inflation?

[itulipdotcom]

We tried it. It doesn't make much difference. A 2x inflation in a 80x scale is noise.

[Rofocales]

At the most I believe you times any 30s era onwards by 12 to negate inflation. And thats 70 years ago. By the 80's it's probably much less.

[RonPaulR3VOLUTION]

Adjusted for inflation.

itulip com/images/fedborrowCPI.gif

Maybe this should be posted in the info section of the video.

[RonPaulR3VOLUTION]

Or even better, added to the end of the video. :)

[alkatifa04]

I beg to differ...

'if you think central banks know what they're doing...'

I know they know EXACTLY what they're doing!!

[jmacco2188]

good music choice for the vid. wow we might be pretty fooked i guess

[NaTaSBlood]

YAY!!! We're Doomed!

:)

[Shockna]

Does anyone know what the picture for the great crash is? It seriously creeps me out.

[groover818]

I believe that is an illustration made for the Panic of 1873 which resembles our current situation more then the Great Depression

[DjetGlea]

Why dont we sell Hawaii to Japan or china for 10-15 Trillion. It could help pay off the national Debt. Then we could make Puerto rico our new 50th state. Problem solved.

[wwwdotLPdotorg]

DjetGlea

Better idea, why not sell Washington DC, that way we can get rid of the problem.

[Razimus]

Well, there's always a silver lining, bums won't be the ones jumping out of windows, the homless will be getting less handouts but they will be the more prepared.

[buttpoop3]

YAY MORE RECESSION!

[ld80061]

If all we get from this is a iron-fisted recession like the '82 recession, we should count ourselves extremely blessed.

Sadly, I suspect that we won't get out of this one so lightly.  I sincerely hope that I'm completely off-base on this: a full-on economic collapse is NOT a good thing to live through.

[mcfnord]

i agree with you, and that's why i'm thankful the FOMC stepped in to credit markets when investors stepped out.

[runningman54]

Yes, the banksters, crooks in suits, politicians have robbed us blind and are continueing to do so. All the while the sheeple are to busy watching American idol, dancing with the stars, drinking, doing drugs, playing video games to see what's happening to their country. As Mr, B. Franklin put it "people get the government they deserve".

[singas30]

If you lower rates today or provide tax cuts or economic stimulation - the lag before the effect hits the hip pocket is between 3 and 6 months. That places us back in June 2008. If you have only mortgage debt - a secure job ( ie teacher ) the change your perspective - 1. Home rates are falling dramatically, Fuel costs are falling as is virtually every other aspect of the Consumer price index. Not such a bad outlook now is ot ? We needed to deflate the bubble, fortune now favours the bold.

[itulipdotcom]

Agree with the last line, but falling home prices have placed one in six houses below the value of the mortgage. The tax rebate checks were largely saved, used to pay down debt. Few are borrowing anew because they can't even pay their existing debts.

[Bluebull114]

Umm, what?

Those numbers are billions, as they should be..

[misesrothbard]

The debtor is servant to the lendor

[foucachon]

yup!

[eyewitness043]

Great video.

The most important point is that we are in uncharted economic waters. This isn't like any conspiracy of the past. The Global masters may be loosing thier grip on the planet FASTER than anticipated.

The Global elite have refined themselves out of their own arrangement and polarizing themselves as Interest wielding greed driven moneychangers vs. the workers and producer nations of color.

The Eurocentric business model is too destructive and too expensive to maintain worldwide.

[bigcree]

Agreed! Could`nt have said it better eyewitness043. I`m no Economist but all it takes to see this situation as it unfolds is common $en$e. And a will to remain grounded in reality. The fiat/ war based Economy also based on oil is going out. What awaits? That is now up to US laypeople. Don`t waist your time waiting for father govt to fix it. We must begin to reclaim our own community based trade. Plausible? Doable? YES!

[erato99]

We can all thank the Rockefellers, Warburgs, Rothchilds, J P Morgan, and our friend Woodrow Wilson.

[McSav187]

multi-millionaire*

[yitbos2]

How do you figure? 750 Billion divided equally between approximately 260 million people equals less than $3000 per person... hardly enough for me to even miss a paycheck for.

[yitbos2]

In response to McSav187

[erato99]

Chaos would have ensued. Nobody would have shown up to work and shit wouldn't function.

[lazerus9]

"The issue which has swept down the centuries

and which will have to be fought sooner or later

is the people versus the banks."

Lord Acton

[rbolo29]

It's a "System" NEO, your a slave. There are "savers" and there are "slaves."

[StrikitRich]

What would be even more interesting would be the same chart adjusted for inflation.

[itulipdotcom]

We tried it. It doesn't make much difference. A 2x inflation in a 80x scale change is noise.

[iPREnZ]

Good point.

[Natkane]

I believe the $3.5 billion spike in the early 2000s is not Y2K precautionary borrowing. It is the borrowing that occurred as a result of 9-11. The spike does not appear in the Fed data until September 2001. Thanks for the video.

[knightstryder21]

They know exactly what they are doing. Bankrupting the nation and the world was and still is thier agenda. They want a one world government that this crisis is suppose to make us beg for.

Problem/reaction/solution

start connecting the dots before its too late.

[alex3914]

Obama didn't wreck the sytem yet?! What's taking him so long?

He must be a little rusty from all that experience he has......

[mcfnord]

i believe this is mistaken nonsense.

[inertia186]

Please explain.

[mcfnord]

i'm trying to reply using another browser this time.

i refer skeptics to the recent bloomberg video of bernanke's explanation.

it does not have fancy pictures! but it made me quite comfortable with the monetary policy stepping in to act when banks are not.

i'm convinced fiat currency has risks, but is not a bad idea.

an hour ago, my critique here had as many minus votes as the guy blaming the jews.

so it doesn't matter what this particular majority thinks. nuts!

[inertia186]

Are you and I looking at the same video?

[mcfnord]

It made me comfortable that support of credit markets is not inflationary, because the government is doing it *in absence of competing parties*. Once lending returns, these assets will be discharged. It's kind of obvious and honestly it's quite clear the topic is poorly understood. my words have a worse score here than the guy who blames the jews. serious forum for monetary policy? ha.

[jagiar]

This post is completely without logic. I think it is YOU who does not understand this topic (with all due respect). The more dollars you print (for whatever the cause) without the backing of some type of production (whether it be gold or something else of rarity) simply devalues the currency, which creates inflation. It's pure and simple. So to say it's not inflationary due to "absence of competing parties" is delusional.

[mcfnord]

Specifically the M3 or M2 money supply is not growing because the FOMC is lending where banks did previously but are currently unwilling/unable. The consequence is *no change in the M3*. Pure! Simple! Delusional! So I remain in dollars. Current dollar strength still due to deleveraging and fight to safety? That's the thesis growing more delusional with each day! ;) I believe a cogent thesis be Bernanke before I believe spooky YouTube... and I'm delusional! ha ha sure.

[myrelative]

M3 is growing, although not as much as in recent years, so you're mostly right here.

fact is we have both inflationary(base money supply) and deflationary forces (credit contraction) right now and there is a huge discussion which one will win.

however, in the long run I just can't see any way the Fed could contract it's base money supply without rasing interest rates very much as soon as there's a rebound.

if they do, welcome to japan.

if they don't we'll have massive inflation.

[kdeanyt]

If the House gets their way, that little blip at the end will be historically insignifagnt.

Why the HELL do people think government control of moeny is acceptable? Why the hell aren't people moving? Why the hell aren't they taking their Star back and withdrawing from this sham called "The United States"?

[whaler3232]

Why the HELL do people think government control of moeny is acceptable? - Silly person, the government does not control the money, that would put power in peoples hands which is a no-no to the elite. The FED is not the gov't, it is a private entity made up of a cartel of private banks. google money masters and open your eyes friend.

[kdeanyt]

I'm well aware that The Federal Reserve is a quasi-private organization (Board members are appointed by the President... Last I checked that wasn't typical of private organizations.).

That said, the government people have "legal tender" laws requiring those who engage in business to accept the currency of the land.

If the government people weren't enforcing a monopoly on the use of the currency, people could simply USE A DIFFERENT CURRENCY in their day to day transactions to combat inflation.

[goldstd]

Why I'm not moving?

1. I'm broke and in debt.

2. My family, friends, and job are here. I have none of those outside of the U.S.

3. It's the same stuff everywhere, or even worse!

4. 4xtech said in an earlier post, "Obama will wave his magic wand and make it all better" and I'm steadfastly pinning all of my hopes and dreams on that.

[badnewswade]

Of course I'm sure that's all inflation-adjusted...

[evilhenny2000]

how is Obama suppose to be the first dicator of America if the system doesn't crash.

[KeladryL]

He's only been in office for eight days; give him some time to crash it!

[itulipdotcom]

See new Version II of the video with edits and quality improvements.

[GinaCrisanti]

who is ron paul?

[MengersDisciple]

That novel hasn't been written... yet.

[LucidNation]

Gross oversimplification. Yes this is orders of magnitude beyond earlier eras, earlier eras had smaller populations, non globalized economies, and no tech revolution. Adding the scary music and using words like "Fed Fail" makes this video nothing more than fear mongering.

[itulipdotcom]

We've been doing this for ten years through "There's no tech bubble, it's a New Era" and "No housing bubble, there's not enough land" and "There is no credit risk due to securitization" and blah, blah, blah. Sorry, take your Pollyanna techno-utopia crap elsewhere.

[MengersDisciple]

:)

Leave it to the Keynsians to obfuscate the obvious.

Keynes argued that governments should solve problems in the short run rather than waiting for market forces to do it in the long run, because "in the long run, we are all dead."

We he died and rotted in the ground all right. We are having to deal with the bountiful fruits.

ATTRIBUTION: John Maynard Keynes (18831946), British economist. A Tract on Monetary Reform, ch. 3 (1923).

[MengersDisciple]

Brilliantly done!

Can you upload an HQ version by any chance?

You are on Digg and LewRockwell (dot) com (search for Ben Bernanke's wild ride).

Thank you for this video.

[itulipdotcom]

Thank you. See new Version II of the video with edits and quality improvements.

[raoulduke25]

Great video, but one minor flaw: the Central Bankers know *exactly* what they are doing. Stay informed indeed.

[Zethys]

Chilling.

PREPARE.

[kungfumonkey2]

Who is John Galt?

[BigBrotherMateyka]

Call me a greenhorn, but what does this all mean...and what can we the average citizen do?

[ld80061]

It means serious inflation is coming along, within the one-to-two year timeframe. My guess is that it will top out at around 20% a year for a decade or so.

What to do? Gain multiple income streams, exit all financial instruments, pay off the house. Gold is good, but dependable, friendly neighbors are far better than gold. Purchase firearms, and learn how to use them for home defense. Build up gardening, handyman & first aid skills. Be prepared for hardship. Love your people. And pray.

[goldstd]

When you say 20% a year, how is that measured? I'm not sure what you mean by it. And, do you have any words of advice for those who can't afford to pay off their houses?

[ld80061]

I meant an escalating level of inflation, tyopping off at 20%, measured on a yearly basis. For example, inflation at 12% in 2015 (say), 15% at 2016, topping at 20% at 2018 before falling to lower (but still historically high) levels of yearly inflation.

If you can't afford to pay off your house immediately... hmmm. IF you are financially rock solid, I recommend that you renegotiate your loan, to lock in todays low rates for as long as you can.

[ld80061]

These are the lowest rates we will see for a generation. BUT, you must be able to maintain payments for at least 5 years, no matter what.

You have a job, friends, and family. You are right not to give them up - that kind of invisible wealth is pure gold in hard times.

Seriously, get out of as much debt as you can - especially credit card (and other hgh-interest) debt. Consolidate your debt, and get it on a low-interest account. See if you can renegoitate payment terms.

[CurtHowland]

It's one thing to know the empire is going to collapse, it's quite another to try to grasp just how quickly it's happening.

[LookBetter4Ever]

yeah right!

[JoshuaTreee]

So what you're saying, is that we should stop making graphs?

[LookBetter4Ever]

we.., they did stop reporting M3!

[CyanideLacrosse]

best reply by far

[danielsp9]

hahahaha and Obama wants to increase spending? What a joke

[damania]

What's that music? I want the mp3!

[mlankheim]

That is the Moonlight Sonata, by Beethoven.

[damania]

Thanks. What about in the second half of the video?

[itulipdotcom]

Freeze the credits at the end it says the song is "Clubbed to Death" from an album "Furious Angels."

[damania]

Thanks! I've been search for the 'answer' for so long!

[RandyOparowski]

:)!

[selectordubu]

Rob Dougan - Clubbed To Death

[dziadeksmierc]

I think they KNOW what they are doing. They are just preparing big inflaction in cover.

[eyewitness043]

I hear your argument that they "know".

But, where is the evidence that this much "money" has ever been used to get any single thing done? The fact is, NOTHING like this has ever happened b4.

The scary, yet exciting part to this is nobody has predicted where this ALL is going collectively.

What's not being explored is the likelyhood that "The New World Order" may begin with the End of the European Corporate and Financial Domination and the unequal distribution of wealth.

[juglord]

1 billion in the 20's is different from 1 billion today i don't know much but i know it doesn't have the same value

[Zoobilord]

Even adjusted for inflation, the numbers are still insane.

[ghalpin23]

You are right, and the reason is INFLATION, i.e. the increase in the money supply.

[aspiehler]

Today's dollar is worth approx 1/25th of a gold-standard dollar.

[heyerstandards]

Or worse, maybe they do know what they're doing. They're either incompetent or criminals.

[JRCrowley]

Thieves.

[dontblamethemessenge]

They must have awesome printers (Hewlett Packard?) and computers to make so much money.

[jibbi4one]

Just drive dump trucks full of dollar bills and dump the worthless paper money on the streets in front of Wall Street.

Nice photo op for the masses of mice.

LOL

[davincij15]

nice video.

Free a slave today, get rid of your currency, buy gold and silver.

[roundman3000]

More evidence Central Planning doesn't work. You think we would have figured that out by now.

[CurtHowland]

Agreed! People keep putting their faith in central planning, then blame some never-identified "free market" for the resulting destruction.

What ever happened to "Question Authority"?

[cpic9932]

(cont.) this is my last post i don't intend to "hog" this board

I am not saying i am right........i think i am close...but until websites can weigh these options more unbiasedly without fear they will lose credibility among followers (requires alot of tap dancing with words or subforums) i think we are missing potentially the big picture and it's a big shame

[cpic9932]

(in cont.)

and what i am saying is not as "evil" as it may appear....why couldn't it be true that it is the best system that is politically and finacially acceptable

the system is desinged with the knowledge that it will eventually collapse, and when it does .....you can favor creditors or debtors when organizing a new system...unfortunately greed and influence among the deciders/creditors may suggests the former....esp w/ the ignorance and naivety of the debtors (with an assist to the media

[cpic9932]

Itulip is a great place for a variety of perspectives on the economy

the one MAJOR drawback i see on most "popular MKT internet forums" is the FEAR the hosts have of losing credibility by entertaining in a unbiased way that the eventual (eventual in a debt based fractional reserve fiat regime) "end game" of the fed is DESIGNED to OWN all the assets when the system suffers a systemic collapse.......while appearing to be trying to work out a solution for the "greater economy" ..

[DrunkenPublicness]

The word in your title should be "reinflate".

[itulipdotcom]

Or reflate. Either is correct.

[stelmogunnut]

The dollar is toilet paper at best.

Thank goodness for ammo, firearms, silver and gold. I can get more for bartering.

[jpbalkenende]

Well now that we know monetary policy to be ineffective can we burn all that garbage Friedman wrote?

[CurtHowland]

It's amazing that people still trot out Friedman as if he's the fringe lazze-faire Libertarian, when he was nothing of the sort.

Yet even he, in his role as the "court anarchist" in his "Free To Choose", did identify how to stop the "insane" inflation of the 70s: Stop Printing Money!

But his elevation to Court Jester did serve the real purpose, it stopped people from paying attention to Rothbard.

[jpbalkenende]

Whatever, we now know his central criticism of FDR/Keynsian economics, that the great depression or all great depressions can be avoided simply with monetary policy was WRONG! He was a smart man at times blinded by ideology.

[diah4]

I knew that shit was gonna jump whem Reagan was in office. He ain't shit. That last number was ridiculous!! wow!!

[soubari]

Watch UK MP SIR Gerald Kaufman exposes Israel's Crimes (google qMGuYjt6CP8)

Watch US Professor Norman Finkelstein exposes Israel's Crimes (Google bm5OvSeiAHc)

Israel admits: "No Hamas rockets were fired during ceasefire" (Google uOaLU0wfqdI)

Please distribute and contact your Senator and/or Representative. Peace!

[4xtech]

Everything is going to be fine. Obama will wave his magic wand and make it all better.

[jman375]

The only conclusion I can think is the banks know it won't work and want a crash.

If you was ready for it as little as a year ago and bought gold,you would have tripled your money by now,and could buy lots of property?

[VendettaVV]

"You are a den of vipers! I intend to rout you out, and by the Eternal God I will rout you out. If the people only understood the rank injustice of our money and banking system, there would be a revolution before morning"

-- Andrew Jackson.

[junkacc11]

whats the music at the end when the huge borrowing starts?

[itulipdotcom]

It's in the credits at the end: "Clubbed to Death" from the album "Furious Angels"

[maximouni]

Our senators suck, Fed is sucking us dry.

banks can not stay open, the only thing that is next

is the collapse of the dollar.

[nextdimensions]

this video is OFF THE CHARTS !

think: EXPONENTIAL CURVE... there is no stopping this blowout of the machine

[lostinmaya]

I'm sick.

[MR18763]

Go take some NyQuil

[GBZ10TROY]

The BIG difference, or the ELEPHANT in the room is the fact that previous borrowings have been funded my precious metals backed currency. The present 'bailout' is funded by paper that has no real value other than the faith placed in it be individuals. When it is realized that the hundreds of billions are basically worthless paper the game will be up.

JFK was assassinated because he wanted to stayt on the gold standard and do away with the Federal Reserve, the oxymoron of oxymorons.

[gt40f]

I think it's all intentional. To create a crisis and drag the US down so everyone will be more compliant to a NWO

[rvaldez5987]

Im sorry but I support a World Government. Preferribly one that punishes the stupid.

[Moragauth]

You'll be first then.

[ricochetVendetta]

The end of the world has a good soundtrack to it at least

[largo2001]

Awesome. Make sure you are your love ones are prepared:

BUY GOLD BULLION! (no ETF or other junk: BULLION)

[mongobobo]

buying gold now would be like shorting real estate in 2002. If you have gold etfs or miner stocks stay long until March-April. Starting in the summer one of the three big banks left (BAC, JPM or C) will utterly fail and no government will be able to save it. Expect gold, stocks, energy, EVERYTHING to tank hard and the dollar to soar over Summer '09

[sickmint79]

are you crazy? they can create as many dollars as they want. dollar soaring has been the length and extent of this rally/delveraging.

[mongobobo]

I just heard on the news that Obama is setting up a 'Bad' Bank to take all the worthless paper off of BAC, JPM, C, etc. books. This act of treason is going to shoot commodoties and all stocks higher for the next six months at least. The dollar will fall much lower until one of those banks go under anyway later in the year causing another dollar rally.

[largo2001]

who said anything about gold etfs or stocks?

I said BULLION.

again. in slow motion this time:

B U L L I O N.

got it?

[mongobobo]

Buying bullion right now would be the most stupid thing you could do. Almost as stupid as buying real estate. Stocks can be traded easily at any time. Bullion isn't as liquid.

[largo2001]

Perhaps not as liquid (but maybe also not true if they shut down the exchanges for example);

ask yourself, have you ever tried to stop robbers with a gun store receipt? Me, I prefer the gun.

[blvoss]

Excellent vid.  Liked the music and message.