US Recession Watch, June 2020 – The Deceitful US Yield Curve? Well, let’s face it folks, for the US economy to recover from the current depression, the Federal Reserve is going to have to spend some money.
Yes, a stimulus package has been negotiated by the President, Congress and the Federal Reserve, but it’s not enough. We’re talking about hundreds of billions of dollars in additional budget deficits over the next decade. In addition, the Fed has more than just its credibility to repair and re-tool at stake.
Let’s take a look at the Federal Reserve as we contemplate the US Recession Watch, June 2020 – The Deceitful US Yield Curve? For starters, the Fed is quite obviously unable to control the inflation.
Yes, the Fed has stated that it is keeping rates low because they believe inflation will eventually rise above the Fed’s target. It would appear that they were hoping that some inflation would take place first, before the US citizens would begin to suspect the truth and just about begin to show their discontent.
There is no fallacious hope at work here. The government simply believes it can be creative when it comes to lending money at higher interest rates, a process known as Quantitative Easing. But, of course, the Fed just got caught doing a little bit of legwork on its own.
Consider this story – A couple was in a car accident and needed money quickly, so they went to the bank, obtained a loan, and received a higher rate of interest. When the car needed repair, the couple went to the bank, once again, obtained a loan, and received a higher rate of interest. As it turns out, the couple had recently bought a car, and that caused their credit score to plummet!
How did the Federal Reserve come to this conclusion? Well, when a bank loans money to the public at a higher rate of interest, that is not going to do the US economy any good, right? It is a false economy, one that is only going to continue to spiral downward.
But, that’s precisely what the Federal Reserve has been doing, and it continues to do. And, it has been very effective, because no matter what the government does or says, people simply will not get their act together.
Worse, as the public acts up and starts to demand change, nothing happens, because politicians are afraid to say anything of consequence, even though the Americans who are suffering the most in this Depression are the same Americans who voted them into office. The US economy is spinning out of control, and a crisis of this magnitude cannot be allowed to continue.
For US Recession Watch, June 2020 – The Deceitful US Yield Curve? So, what’s going to happen now?
It is important to note that a recession is not going to happen overnight, and there is no way the Federal Reserve can keep making these kind of financial mistakes forever. Additionally, a future downturn is inevitable, so, you see, the Fed needs to either sit down and figure out how to stop it, or admit its error and have the shame to re-think its monetary policy. At present, it seems as if they don’t want to talk about the fact that they are just making this US Recession Watch, June 2020 – The Deceitful US Yield Curve, all for nothing.
So, the issue becomes, does the US economy really need another recession, or is this US Recession Watch, June 2020 – The Deceitful US Yield Curve just a hoax. You decide. Considerthis in 2020.