Monetary policy and the accompanying interest rates, they make a big splash on many things in all facets of the societal tide . Ebb and flow. From the little individuals life preserver, to small business’ and their highly regulated fishing strategy(Canada has over 72,000 business regulations in the federal code alone), and of course the gravitational pull of government and major corporate banking bottom feeding that turns the diverse plenty of the ocean into a riptide which leaves a fiscal lagoon where the little individuals life forms are preyed upon by the behemoth government poachers, and the little business boats attempt to stay afloat while bringing in a meagre catch in order to feed its small crew. Is the kinetic energy from the governmental debt and interest rate rogue wave and coming digital currency gravity multiplier going to drown a significant portion of those just treading water to survive?
The little guys/girls. Interest rates are quite important to the average person and how they live and perceive things. Be it for seniors and living off of the interest from the savings that they managed to acquire in their working life. Home ownership, is there anything as liberating as to have a piece of something to call one’s own(don’t ask me). A kid’s first savings account, nothing like learning that a bank pays(used to) you decently if you are fiscally responsible and save money for future use.
The above 3 notions are a few examples how a devolving, ever increasingly debt driven, artificially low interest rate monetary policy has come to skew the foundation of a once positively reinforced monetary societal construct, and in the process has come to hurt the little guys/girls in a big way.
Seniors are no longer able to live off of the interest of their savings that once gave them a return greater than the rate of inflation, in affect drawing down their savings and continually leaving them with less money to live on every month.
As far as home ownership is concerned, the artificially low interest rates are responsible for driving up housing prices as low interest rates overall lead to less responsibility as it cheapens money and therefore there is more money chasing the same house which drives the price up. It should be fair to note as well that individuals and institutional investment firms are buying houses up at a massive rate because they want something tangible in their portfolio, as government is currently destroying the monetary system and money at an ever increasing rate. When money is being destroyed and loses its value, the smart ones buy something real so as to not be in possession of a depreciating currency. This is another reason for homes, used cars and collectibles seeing significant increases in value.
As for a kid’s saving account paying a decent interest rate, it might be easier to explain to your posterity the atomic construct of of a martian species from a parallel universe that has 57 more elements than the known 118 on earth. They are after all, both, alien concepts.
In reality have we not ended up in this economic nightmare due to the shirking of responsibility and not allowing the financial sinners to be excoriated and free markets eliminate the inept bunglers? Now government must punish all in order to save and protect their bedfellows while the small girls/guys suffer for others sins. When systemic societal responsibility goes out the window, societies days are numbered. Unfortunately parasitism has proven that days indeed turn into years. Amazing what the mainstream media propaganda machine can accomplish when they have the majority hypnotized. And to deflect attention from their gross incompetence, politicians leave the scent of successful(“rich”) people being the problem and the mainstream media fills the airwaves with victim and equality narratives for those gullible enough to fall for the distraction bait.
Rewarding banks with bailouts for their speculative/criminal behaviour and then stealing money from the taxpayer to save them was the beginning of the end of the fiscal debacle we are traversing. An end to which government is in denial and has taken interest rates to historic lows, some at 0% and even negative rates in some countries(Switzerland, Denmark, Japan) in the vain attempt to keep the Ponzi scheme going. Yes, a negative interest rate means you pay the government to hold onto your money for you. What has the political world come to for this to be portrayed as acceptable? Would an objective non-propagandized news program not have some continual hard questions for politicians about these unsustainable debt and interest rate levels? Capitalism has ZERO to do with government bailouts and political intrusion into the government bond market. Some would argue that the West has devolved into financialism.
For those unaware. When it comes to government bonds, there are municipal bonds, provincial/state/territory bonds, but it is federal bonds that I write about as they are top of the bond chain and perform the function of regulating a country’s interest rate policy. Of course corporations also sell bonds to raise money for growth/production, but that is not important for this article.
A basic explanation of the bond market is there are short term bonds, 5 years or less, and long term bonds. A 30 year bond is the main interest rate fixing bond for our rate of interest on mortgages. Some countries even offer a 50 year and 100 year bond. Though when you buy a bond of whatever length maturity, it does not mean that you have to keep it for the whole duration, you are able to sell it back into the market if there is a bidder who wants to buy it at the bond auction. It should be fair to note that first world government bonds are considered low risk and government will even give you a tax break(bribe) for financing their perverted machinations. Second and third world bonds are riskier and typically pay higher yields, but the chances of your investment vaporizing is much higher. Argentina is one serial defaulter.
The way the bond market always used to work was, individuals, companies, pension funds, insurance companies or sovereign governments can buy a bond of whatever country they so choose and in the process they have just funded that government to pay exorbitant politician wages and pensions, build roads, fund the coast guard or drop bombs on innocent muslims and give weapons to “moderate rebels” half way around the world, or anything that a federal government wastes much of its money on. The perverted game worked well when there was enough of a bond yield to satisfy the customers, though now government has massacred its own gravy train, so governments at their puppet masters orders are going totalitarianism in nature.
When there is less bids for the amount of bonds for sale, bond yields(interest rates go up) giving incentive for entities to buy bonds and make a profit. When the demand exceeds supply, bond yield fall(interest rates go down) as the market is saturated. A bonds interest rate compared to the rate of inflation is considered its real return. So, if a bond pays 3% annually, yet the rate of inflation is 5%, then your real bond return is -2%, you actually lose money over time due to inflation. In the past, the point of bonds was to pay an interest rate higher than the rate of inflation, so as to make it financially viable for the entity to make a profit and be happy about doing so. Not anymore. Politicians have managed to pervert the financial system and accompanying bond market to the point of it having blown up, yet they are in command of it so they carry on in an extremely bastardized fiscal manner.
After the 2008/2009 financial crisis brought on by predatory banking approved by government regulators, it was “necessary”(instead of letting irresponsible entities fail) to artificially lower interest rates in order for all insolvent parties to have less of a debt burden. Government does this by what they call monetizing the debt/quantitative easing/government bond buying program. Basically the country’s treasury just brings excess bonds into existence and the country’s central bank buys these bonds as well as those at bond auctions with made up money(no responsibility or hard work went into creating this money) so interest rates go way down, which is supposed to stimulate the economy as the price of borrowing money goes down, which, according to government logic will make people and business borrow to buy and create things.
Unfortunately many people, companies, corporations and above all, governments ,debt burden is so high that they are not able to make the low cost of money work for themselves. But it gets worse. The debt level of many, government at the top of this list, is so high that they have become addicted to the fake low interest rate environment. So if governments stops their bond buying program and interest rates are allowed to return to historically normal rates, then the servicing of all these entities debts become unmanageable and the whole financial system collapses after the supernova event and the debtors are crushed in a black hole of insolvency. And yes, if interest rates ever do begin to rise, that means the monstrous federal government debts will balloon to unthinkable heights, which means these damn politicians are going to get us in the Father Nelson hold and do us dry until we can take no more of their fiscal tax rape regime. You have been forewarned!
Even before this covid 19 charade, politicians fiscal spending was out of control(again lack of responsibility.) But now politicians have managed to shoot themselves in the fiscal face and are ignorant enough to wonder why they are hemorrhaging money. As mentioned before government brought interest rates to abnormal lows in order to save the predatory bungling of financial institutions and now find themselves without any tools to remediate the current financial situation. If you voted for a politician because he promised you something for free, you are a contributor to the problem. Nothing from government nor politicians is EVER free.
Being out of tools, politicians have decided to create and brandish a predatory weapon in order to beat their subjects into a submissive state of captive compliance in order to hold onto their undeserved, unwarranted, uncouth position of bungling dominance over the subjects in their perverted realm of moral and monetary bankruptcy.
The forgery which they are forging into their weapon to wield against the populace is the digital currency system, where the elimination of cash is the ultimate end to the means which supposedly sovereign governments and their politician puppets are working overtime in conjunction with the globalist institutions of the International Monetary Fund and the World Economic Forum to make this nightmare a part of their “utopian” dream state of globalist government. Narcoleptic nincompoops. Of course politicians, the WEF and IMF all spin a track and trace captive digital currency system as “liberating,” “inclusionary” and “equitable” for humanity. Yeah, and cutting off your legs is beneficial too, because you save money on soap, socks, shoes, razors and long pants, not to mention not burning so many calories due to lack of tedious walking, which will reduce your grocery bill, and now you can save even more money by only purchasing a single storey home too! Legs, way overrated!
Time to be alarmed and set your alarm, it is best not to sleep past your slavery auction. Any true benevolent government would make legislation banning the elimination of cash and then make it a recurring theme in a logical and enlightening education system to teach the elements of freedom, liberty, emancipation and check and balance that cash brings to a fairer society.
Cash is critically important in the fact that it gives humans an extreme level of privacy from government and banking prying eyes. No cash = no privacy, which = no liberty or freedom. Cash is vital as a form of protest and the overbearing dominance of government over ALL of your life’s affairs, as well as ignorant banking practices. When governments get extremely tax aggressive as they are now and are about to increase because of their bungling of fiscal affairs, cash is the vehicle of escape from government tyranny. Why do you think they are working so hard to normalize digital currencies. They want to create absolutely nowhere to run from government mismanagement. Government will eventually bleed you til you run out of blood.
As far as banks are concerned, why keep all your money in a bank when it pays almost zero interest? Let banks feel some of the pain they are doling out by reeling in your money in cash form. Once cash is eliminated it is literally possible to have permanent negative interest rates on your deposits, and the absence of cash means you suffer at the banks tyranny as you can not withdraw untraceable cash. Cash is CRITICAL for punishing irresponsible behaviour of government and banks! Do not let our politicians be rid of it!
Most Western governments at the hands of incompetent politicians who signed off on predatory banking practices have destroyed the global financial system with deregulation and the elimination of true free market capitalism and in its place have ushered in the appalling era of hyper-financialism, where the only debt that goes punished is that of the little people and small business. Where as government and the bigs in bed with government are encouraged and lauded for atrocious financial responsibility.
In order to keep the Ponzi scheme going and the debt nightmare flowing, politicians have lowered interest rates to historic lows so as to not blow themselves to smithereens, and in the process have severely punished the little guys/girls with lack of income from interest bearing savings accounts and bond returns, all the while inflating a housing bubble, making home ownership a pipe dream for younger generations as predatory entities gobble up the tangible asset of housing.
Now that government is unable to go any lower with interest rates in order to control(bungle) the economy further, they have begun the totalitarian process of creating and implementing captive control digital currency systems and planned elimination cash to gain complete control over their subjects and block people from acting out their own financial plans and future. Because if politicians and their puppet masters can just get total control of the money supply, this time will be different! YAWN!!!!
Politicians would rather enslave their populaces in a zero privacy, fully controlling, track and trace, digital currency bondage system than step back, admit that they have been incompetent at managing the monetary system for decades, get their foolish debt obligations under control and start the road to recovery for the subjects encapsulated in their dystopian international institution nightmare.
Canada has three parasitic stooges at the head of this planned and unravelling globalist monetary system nightmare, and they will be the features in my next article. Hint, one is quite probably the son of Fidel Castro, one felt it necessary to lie and deceive the public about her Ukrainian Nazi heritage, and the last has the namesake of a carnival working huckster. Anyone who knows a Carney realizes the game is always rigged!
CR