Thursday, January 05, 2006

Feds Create Extra $60 Billion This Week--Inflated Stocks Shoot Up

By Elaine Meinel Supkis

So, the government printing presses (all computerized "money", actually) injected $60 billion make believe bucks into the system this week in order to reinflate the stock and housing markets! What happens next? Wouldn't you like to know!

One of our readers, Frank, left this blog URL at a previous comment section, it is very interesting. From the Cunning Realist, a MBA finance executive:
Today, the stock market rose sharply after the Federal Reserve released the minutes from its December meeting, and investors interpreted those minutes to indicate that interest rate hikes are nearing an end. But something else also happened today. The Federal Reserve increased its level of temporary liquidity to the highest level since 9/11. For those not familiar with the term, liquidity is essentially money created by the Federal Reserve that acts to support various assets such as stocks, bonds and commodities. Today, that pool of liquidity reached a stunning $60 billion, up from $23 billion in mid-December. To be sure, the Fed boosts liquidity at the end of every year, but size of this increase is extraordinary and far greater than any previous year-end.
As I noted here, there was no really good reason for the stockmarket to shoot up suddenly after New Years. I knew the system was being gamed, of course, since the fundamentals stink like a dead skunk on the highway to hell.

So here it is! Hahaha! Magic numbers time. Note that this mirrors the flood of money we spat out right after the 9/11 disaster. 9/11 caused America to veer away from the Clinton/Ruebens gameplan to the Bush/Greenspan Skull and Bones game plan. Namely, to run up giant debts, cut taxes for their rich buddies and sell America to Japan. It worked. Part of this conspiracy with the Japanese is why the Fed can claim they are done raising interest rates even as they beef up the money supply due to inflation. Hold onto to your wallets!

Let's visit the owners of America who are in the news again today: From the New York Times:
Hopes were high for Japan's economic resurgence at a New Year's party for corporate executives Thursday at a time when profits are rebounding, consumers are spending and stock prices are at five-year highs.

For the first time in years, the mood was positively ebullient at the annual gathering of business leaders at a Tokyo hotel. In previous years, as Japan struggled through a 15-year period of stagnation, the parties were much less sanguine.
You bet, they are happy! Japan has never really opened their borders to any competitors at any time. The whole "free trade" garbage is the vehicle they ride when they want full access to a market while keeping competition dead in Japan. They have a huge arsenal to do this. For the last 25 years, Americans were supposed to be bargaining to reduce the barriers and increase access to Japanese consumers, all in vain up until Clinton began to twist their tail on keeping the yen cheap.

As he balanced our budget, he forced them to give a truer accounting of basic currency values. This ticked them off, killed their stock market and soured their monopoly on trade at home. They had to do something.

So now, thanks to the American right wingers who supported the Japanese tool, Reagan, who was paid over $2.5 million dollars to scuttle any serious changes to Japanese fiscal games, we have another traitor for President who has extended the Reagan/Japanese conspiracy to greater heights. The money the Fed created out of thin air was to hide the fact that inflation is raging here at home and the dollar should drop by at least 30% in value vis a vis the yen.

Yet the yen lost value even as their unemployment drops to near zero, their exports have surged, everything is coming up roses in Japan as America destroys our currency, unseen. For the $60 billion that was created will end up as Japanese loans! And these loans will come due in the form of us being Japanese slaves, namely, our military and diplomatic policies will be written in Tokyo and we will have to spend more and more on military might which will NOT defend America! Look at 9/11 to today! We needed the National Guard here at home and they were in Iraq. Pumping oil for Japan.

Indeed, things are truly out of whack. I read today that auto sales in Japan are down. Yet the executives of the auto industry are particularily upbeat. Guess why!
''We can't just talk about the good news,'' he said, pointing to the health of the U.S. economy and surging oil prices. ''But stock prices are surely going to rise some more.''
This sick relationship we have with Japan scares the Japanese who openly wonder how much longer this can be sustained. It looks to them as if the money creating machine in America working in tandem with the money hiding machine in Japan can go to infinity.

This is insane. No system ever, ever goes to infinity. The Germans tried it in the Weimar years. Being very efficient people, they nearly achieved this. It destroyed the economy and ushered in Hitler who turned the whole thing into WWII. See? Violent wars are the results of trying to hide money manipulation by going for infinity. We cannot run up infinite debts with anyone or anything. It is impossible.

Not only are essentials inflating rapidly, food, fuel, medical care, schooling, local taxes and fees, but so are things the rich buy such as gold, silver, art works, race horses, high class properties, etc. When the working class gets raises, the Feds worry this will cause "inflation" but when the rich get ruinious tax cuts and trigger a tidalwave of red ink and then bid up the price of things they like to buy, this doesn't cause "inflation" according to the Feds because they refuse to track it as inflationary.

Indeed, these price hikes like the one in housing, is celebrated as "gaining equity" rather than as rank inflation. Yet this is worse than worker-fueled inflation for it prices workers out of the housing market or forces them deeper into debt to obtain housing while making the rich who develop the properties, richer.

The stockmarket is being manipulated, tremendously. I remember in the fall, everyone was screaming, losing a major American city won't affect the stockmarket and lo and behold, it doesn't. Thanks to Greenspan and his co-conspiritors.
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