President Trump did not create the problem. It has existed for a long time. Barrack Obama, George W. Bush and Bill Clinton did nothing about it.
Like North Korea, Trump inherited the problems. Unlike his predecessors, he’s trying to do something about it.
It began with Alan Greenspan when he kept the cost of funds for banks so low that it became cheaper for banks to borrow from the Fed than pay reasonable rates of deposit interest to customers. That’s a primary reason you cannot get any kind of reasonable rate of return on your savings account or certificate of deposit.
Former Fed Chairmen Ben Bernanke and Janet Yellen kept the Fed funds rates low and our currency was being totally debased. What the current Fed Head Jerome Powell is now doing is what Paul Volcker did back in the early 1980s when the cost of funds got too high. Because of Volcker’s actions, the economy we had in the mid-to-late 80s and throughout the 90s was very strong.
Powell’s problem is the opposite of what Volcker faced, but the solution is the same. Volcker had to bring interest rates that made it impossible to buy cars and homes down; Powell must get low interest rates that are debasing the currency up. Fractional-reserve banking, implemented by Greenspan in the 1990s and continued by Bernanke and Yellen, is the cause of too-low interest rates.
The media wants you to believe it is President Trump’s tariffs on unfair practices involving international trade that is causing radical stock market shifts, but that is not true.
The cost of Fed funds must go up. Yes, it will have a negative impact on the stock market… but the market has been over-valued for many years. Companies are not worth what people are paying for a share of stock in them. That, too, needs to be corrected and the Federal Reserve’s actions will achieve it.
I believe the Fed will be absorbed into Treasury… its illegitimate contract was over in 2013. The Constitution gives responsibility for spending and creating money to the Congress, not a private corporation. We will, thus, take a constitutional step back towards the legal parameters established by our founders and away from a non-government owned central bank controlling economic policy for the nation.
We will probably have a fairly serious recession in 2019 as the markets stabilize. The Democrats love that possibility thinking it is a presidential race advantage but have underestimated just how much the American public hates the Federal Reserve and how much they support their President. The market will right itself in plenty of time for the 2020 election.
Once the Fed is gone, it will be possible to issue a new currency and also include a possible revaluation of the dollar. Look at the bills you currently have in your wallet. They say “Federal Reserve Note.” A “Note” is a loan… like your mortgage note with the bank. As I said earlier, American taxpayers are responsible for the debts of the Federal Reserve which is why the currency in your billfold says “Note” on it. Because we have a $21 trillion debt (some of which is justified and constitutional, some of which is not), every dollar that is printed represents a debt – represents the Federal Reserve lending you money.
Contrary to what the media wants you to think, Trump’s economic policies are positive and needed. There is nowhere it is more apparent that an effort to destroy this nation was well underway than in the way the Federal Reserve System has mismanaged our currency. Because of the Fed, not Donald Trump or his tariffs, the stock market will likely have a dose of the flu for awhile this year.
The stock market can get sick and the nation feels its pain… but the market recoups and moves forward. When your commercial banks get sick, the nation can die.
That is what Donald Trump’s actions are in place to prevent.
Read the entire here: Economic Overview For 2019