QE Never Ended and Interest Rates Have Already Been Cut: We Just Weren't Told About it
The Fed’s MBS holdings have grown from the planned $500 billion to $2.3 trillion as of last Wednesday.
The New York Fed, which has bank examiners engaged in supervising JPMorgan Chase, has also repeatedly provided bailout funds to JPMorgan Chase;
The Fed was supervising JPMorgan Chase when it lost $6.2 billion of deposits from its federally-insured bank by gambling in derivatives on its London trading desk;
The Fed allowed JPMorgan Chase’s Chairman and CEO, Jamie Dimon, to previously sit on the New York Fed’s Board of Directors, even as he faced the $6.2 billion derivatives trading scandal;
and the New York Fed has exclusively used JPMorgan Chase to hold, as custodian, more than $2.3 trillion of the Federal Reserve’s Mortgage-Backed Securities (MBS) for the past 15-1/2 years – despite JPMorgan Chase admitting to five felony counts brought by the criminal division of the U.S. Department of Justice during that time.
Pam and Russ Martens in their investigative reported stated it all so brilliantly “If there was an admitted felon in your neighborhood, would JPMorgan Chase be your first choice for a house sitter?”
During the financial crisis of 2008, in an effort to restore liquidity to seized up markets, the Fed announced it planned to buy $500 billion of MBS that was backed by government-sponsored enterprises (GSEs) Fannie Mae, Freddie Mac, and Ginnie Mae.
That was the first of what would become Quantitative Easing (QE) to infinity at the Fed.
The Fed’s MBS holdings have grown from the planned $500 billion to $2.3 trillion as of last Wednesday.
The New York Federal Reserve's controversial outsourcing of key functions to JPMorgan Chase, highlighting a series of troubling connections and financial transactions between the two entities.
Summarizing:
Bailouts and Oversight: The New York Fed has provided bailout funds to JPMorgan Chase and has been responsible for supervising the bank, which has a history of significant financial misconduct, including a $6.2 billion loss tied to derivatives trading.
Custodianship of Securities: Since 2008, JPMorgan Chase has been the exclusive custodian for over $2.3 trillion in Mortgage-Backed Securities (MBS) for the New York Fed, despite the bank's admission to multiple felony counts.
FOIA Request: Pam and Russ Martens filed a Freedom of Information Act (FOIA) request to obtain invoices from JPMorgan Chase for custodial services. The New York Fed delayed responses and ultimately provided heavily redacted documents, obscuring the amounts billed.
Questionable Billing Practices: The invoices revealed various fees charged by JPMorgan Chase, including custody and transaction fees, but lacked clear documentation on how these fees were calculated. Some invoices went unpaid for over two months.
Future Actions: The authors plan to file a formal complaint with the Federal Reserve Inspector General regarding the handling of their FOIA request.
Prisoners running the Prison
Concerns about the integrity of the New York Fed's oversight of JPMorgan Chase and the transparency of their financial dealings, reveal a 5 alarm fire conflict of interest given JPMorgan's past legal issues and the Fed's reliance on them for critical functions
The "revolving door" between the financial industry and government regulatory agencies has been a recurring issue throughout history. Here are five notable examples spanning several decades:
Andrew Mellon (1920s-1930s): Mellon was a wealthy banker and industrialist who served as U.S. Secretary of the Treasury from 1921 to 1932 under three Republican presidents. He implemented policies that greatly benefited his own business interests and those of other wealthy individuals, including significant tax cuts for the rich.
Robert Rubin (1990s-2000s): Rubin was co-chairman of Goldman Sachs before becoming U.S. Treasury Secretary under President Clinton. After leaving government, he joined Citigroup as a senior advisor and board member. Citigroup later received a massive bailout during the 2008 financial crisis.
Henry Paulson (2000s): Paulson was CEO of Goldman Sachs before becoming U.S. Treasury Secretary under President George W. Bush. He played a key role in the government's response to the 2008 financial crisis, including decisions that benefited his former employer.
Mary Jo White (2010s): White had a long career defending Wall Street banks and executives as a lawyer before being appointed as chair of the Securities and Exchange Commission (SEC) by President Obama. Her appointment raised concerns about potential conflicts of interest in regulating the financial industry.
Steven Mnuchin (2010s-2020s): Mnuchin was a former Goldman Sachs executive and hedge fund manager before becoming U.S. Treasury Secretary under President Trump. He was involved in shaping financial regulations and tax policy that affected his former industry.
These examples demonstrate how the revolving door between finance and government has been a persistent issue across different time periods and administrations. The movement of individuals between high-level positions in the financial industry and key regulatory roles in government has raised concerns about potential conflicts of interest and the influence of the financial sector on policymaking
Throughout history, conflicts between monarchs, bankers, and generals have shaped political and financial landscapes. Here are five notable examples from ancient history:
The Medici Family and the Papacy (15th-16th Century):
The Medici family, prominent bankers in Florence, wielded significant influence over the Papacy. Popes Leo X and Clement VII, both Medici, used their positions to strengthen the financial power of the Medici Bank. This close relationship between the Medici bankers and the Church often led to conflicts of interest, as the Medici used their financial clout to exert political influence across Europe.The Roman Empire and Financial Crises (33 CE):
During the reign of Emperor Tiberius, Rome faced a severe financial crisis. The Senate, composed of Rome's elite, was deeply involved in financial mismanagement and corruption. When the crisis peaked, Tiberius intervened by providing vast sums for interest-free loans, a move that highlighted the tension between the emperor's authority and the Senate's financial interests.The House of Fugger and the Holy Roman Empire (16th Century):
The Fugger family, wealthy bankers from Augsburg, financed the campaigns of Emperor Charles V. Their financial support was crucial in Charles's election as Holy Roman Emperor. However, this relationship led to significant influence over imperial policies, often causing friction between the Fuggers' financial interests and the broader political and military strategies of the empire.The Knights Templar and European Monarchs (12th-14th Century):
The Knights Templar, initially a military order, became powerful bankers in medieval Europe. Their wealth and influence grew to the point where they lent money to monarchs. This financial power led to conflicts, most notably with King Philip IV of France, who, heavily indebted to the Templars, orchestrated their downfall in 1307 by arresting and executing many of their members and seizing their assets.The Bank of England and the British Monarchy (17th Century):
The establishment of the Bank of England in 1694 was a direct response to the financial needs of the British monarchy. King William III required funds to wage wars against France. The bank's creation marked the beginning of a complex relationship between the monarchy and financial institutions, where the bank's influence over national finances often clashed with royal prerogatives.
These examples illustrate how financial power and political authority have historically intersected, leading to significant conflicts and shaping the course of history.
QE to infinity has arrived and here is why we must object
The criminal conduct associated with Quantitative Easing (QE) through the purchase of mortgage-backed securities (MBS) and U.S. Treasuries can be seen as a short-term solution that fails to address the underlying issues of debt and economic imbalances.
From your seats within the distinguished halls of the Silver Academy please take notes on Why Professor Pixy is against it all.
Delaying necessary adjustments: QE effectively allows governments and the private sector to continue accumulating debt rather than addressing fundamental economic imbalances. This postpones the inevitable need for fiscal discipline and structural reforms.
Artificial market distortion: By intervening in the bond market, the Federal Reserve distorts natural price discovery mechanisms. This can lead to misallocation of resources and the creation of asset bubbles, as investors are encouraged to take on more risk in search of yield.
Wealth inequality: QE tends to benefit asset holders disproportionately, as it inflates asset prices. This can exacerbate wealth inequality, as those without significant assets do not see the same benefits.
Dependency on monetary stimulus: The repeated use of QE creates a dependency on monetary stimulus, making it difficult for the economy to function normally without ongoing central bank intervention.
Potential for inflation: While inflation has not been a significant issue in recent years, the massive increase in money supply through QE carries the risk of future inflationary pressures.
Masking fiscal irresponsibility: QE allows governments to continue running large deficits by keeping borrowing costs artificially low. This reduces the urgency for fiscal reform and balanced budgets.
Long-term consequences: The full impact of QE on the economy is not yet fully understood. There are concerns about the long-term consequences of such unprecedented monetary policy actions.
Moral hazard: The expectation of central bank intervention during crises can lead to riskier behavior by financial institutions and investors, knowing they may be "bailed out" in times of trouble.
Limited effectiveness: While QE may have helped stabilize the economy during crises, its effectiveness in stimulating long-term economic growth and addressing structural issues is questionable.
Difficulty in unwinding: As we're now seeing, the process of unwinding QE (quantitative tightening) can be challenging and potentially disruptive to financial markets and the broader economy.
Silver Academy Approach, (um, it’s called common sense)
Implementing structural reforms to address economic inefficiencies
Encouraging fiscal discipline and balanced budgets
Gold and Silver backed State to State budgets first then pressure Federal Government
End the Federal Reserve
Allowing for natural market corrections to occur
Focusing on policies that promote long-term productivity growth and economic resilience
Final Recommendations
Buy physical Silver
Buy physical Gold
Keep reading here on our recommendations for Gold leveraged
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