Excerpts from on essay on Charles Hugh Smith's Of Two Minds blog:
Frequent contributor Jeff W. recently penned this succinct explanation of the Federal Reserve,
and he did so with such clarity
that in my view this is the essential primer on the Fed that every high school and college
student in America should read. If they study this short essay, they will grasp the
essence of the Fed and understand why the financial Status Quo is doomed.
The Fed's main goal is to increase the profits of the big banks. That goal is consistent
with increased profits for all firms and prosperity in general, so long as the banks
and the elites grab the largest share of the profits.
But, that goal is also served
in the long run by boom-and-bust cycles that have a ratcheting effect of concentrating
wealth in the hands of the wealthy. The clued-in super-wealthy can profit both as
bulls and as bears, and can purchase prized assets cheaply at the bottom of the cycle
(on easy credit from their friends at the Fed).
It is a Clausewitzian principle that individuals, organizations and nations will
expand their power until some superior or equal power effectively opposes them and
stops them. Because the Fed's power has no equal, we can expect the Fed's power
to continue to increase indefinitely.
At some point, however, history shows that the slaves and victims of oppressors gain
strength and confidence when they feel a desperate determination to live.
But that point is still far off. The numbers of the righteous are far exceeded by
those who want freshly printed debt-money from Ben Bernanke. Things have not yet reached
the desperate, life-threatening stage which is when most revolutions occur.
Read the article here.
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