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Letters by a modern St. Ferdinand III about cults

Gab@StFerdinandIII -

Plenty of cults exist - every cult has its 'religious dogma', its idols, its 'prophets', its 'science', its 'proof' and its intolerant liturgy of demands.  Cults everywhere:  Corona, 'The Science' or Scientism, Islam, the State, the cult of Gender Fascism, Marxism, Darwin and Evolution, Globaloneywarming, Changing Climate, Abortion...

Tempus Fugit Memento Mori - Time Flies Remember Death 

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Monday, September 8, 2014

Stockman and the cult of central banking

A very appropriate critique of the obvious.

by StFerdIII


David Stockman, former economic adviser to Reagan, and much pilloried by the Liberal-Keynesian-Democratic-Monetarist cult members wrote an insightful article titled; 'The cult of Central Banking'. Cult is precisely the right appellation. The US central bank or Federal Reserve has created no fewer than 10 major financial collapses in the past 100 years; debased the US currency by 95% since 1913; and post-the-end-of-the-gold-standard in 1971 has facilitated the massive increase in government spending, yearly deficits and accumulated debt, which just at the Federal level alone; will bankrupt the US political-economy.


Some facts from Stockman which offend the cult of central banking:


  1. The real economy is not improving:



          2. Real unemployment is massive and not due to 'retirement':


....since the Fed went all-in for money printing after the dotcom crash. Back then there were 75 million adults (over 16 years) who didn’t have jobs; today’s report shows that there are about 102 million jobless adults.

And, no, that 27 million gain in adult dependency is not due to well-deserved baby boomer retirements on social security. There are only 7 million more recipients of old age and survivors benefits today than there were in the year 2000. The remaining 20 million are on food stamps, welfare, disability, veterans benefits or are living in their parents’ basement or on the streets.”

           3. Fed's balance sheet is an irreducible disaster:


Since Greenspan launched the cult of Keynesian central banking and the financialization of the American economy in the late 1980s, the balance sheet of the Fed has grown from $200 billion to $4.4 trillion—or by 22X. The S&P 500 is up 10X notwithstanding three thundering booms and busts in the interim. Along the way, the great financial markets of American capitalism have been destroyed as agents of productive capital formation, efficient resource allocation and honest price discovery. The have simply become a giant, central bank operated and funded casino where the 1% gamble with make-believe money.”


But the most stunning comparison of all, is between the balance sheet of the Fed and total labor hours generated by the non-farm economy. It goes without saying that real wealth is the spawn of work, not central bank printing presses. Yet even as the Fed’s balance sheet has gone parabolic since the turn of the century, actual hours worked in the American economy have flat-lined for a decade and one-half.


CNBC watchers and PollyAnna lovers hate Stockman, or indeed any person who objects to the cult of the central bank, with their permanent interest rate at zero; and their endless printing of money. These big-brains will dismiss facts, evidence, reality and real economics, and in their place substitute; rhetoric, tautology, Keynesian mythology, Monetarist myth-making and made up numbers from GDP to 'unemployment'. Anything to keep the fraud going. We have a systemic sea-change for the worse occurring, but those who subscribe to the cult of central banking could care less. They are too busy flicking their hair and retelling fantasies as fact. The real economy thanks to the cult of central banking is being destroyed.



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