Monetizing the Debt

Two years ago, politicians and media were quick to recognize the ponzi scheme run by Bernie Madoff at the expense of his investors.

Today, however, a much larger Ponzi scheme is being run by the US government at the expense of US citizens. The US Treasury sells bonds to banks. The banks then turn around and sells those bonds to the Federal Reserve. The Fed buys those bonds w/ freshly printed dollars.

This is sometimes referred to as 'monetizing the debt.' But it is a Ponzi scheme, pure and simple. And this scheme is built with an inflationary engine.

btw, nice work for those banks that serve as middlemen, as they are privy to free money for brokering the pyramid.

You may or may not agree with this policy. But as investors, you need to make sure you understand the financial and economic implications.

no positions