So, it will be 100 years on Dec. 23 since the Federal Reserve was born. The purpose in 1913 was to form a regulatory body to help stem the tide of bank failures in the United States of America. How has it done?
There is a new campaign to end austerity. First, the IMF lets it be known it has second thoughts about it; then we are told the threshold of 90% government debt to GDP that must not be crossed, set by Professors Reinhart & Rogoff, is based on an Excel spreadsheet error.
Gold is higher in most currencies today except the Japanese yen. Gold surged over 3% to 0.149 million yen per ounce yesterday as markets shuddered due to the scale of currency debasement soon to be seen in Japan.
It has been obvious for some time that banks in many jurisdictions are insolvent and that they are simply too big for governments to rescue. It should come as no surprise that central bankers have been considering how to deal with this problem and that they have resolved a solution.
In theory, financial repression, together with other measures, can liquidate government debt but, in practice, it is a destructive and highly destabilizing approach that will result in a net loss of wealth to society.