The Crashing U.S. Economy Held Hostage
Our Economy is on an Artificial Life-support System
by Richard C. Cook
................................The question is not when will the system start to come down, because this has already begun. It’s shown most clearly by the fact that according to Federal Reserve data, M1, the part of the money supply most readily available for consumer purchases, is not only lagging behind inflation but has actually decreased in eleven of the last twelve months. This means that the producing economy is already in a recession.
The federal government is trying to figure out what to do. Their biggest concern is that foreign investors have started to pull out of dollar-denominated markets.
The government’s “plunge protection team”—known officially as the President’s Working Group on Financial Markets—is trying to engineer what they call a “soft landing.”
It’s been likened to the process by which you cook a frog in a pot where you raise the temperature one degree a day. The frog doesn’t hop out because the heat goes up gradually, but before long it’s too late. The frog has been cooked.
Even if the plunge protection team succeeds, and the frog cooks slowly, there will be a massive de facto default on dollar-denominated debt and a long-term degradation of the U.S. standard of living. The inside word is that we are likely to see major monetary shocks and a possible stock market crash as early as December 2007.
The worst off will be people locked into retirement funds which have a heavy load of mortgage-related securities. Entire investment portfolios are likely to disappear overnight.
See this most interesting article at: http://www.globalresearch.ca/index.p...xt=va&aid=6239
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