What happened to those trillions of dollars the Federal Reserve printed during the financial crisis? Why aren’t they causing mass inflation? Robert Murphy of Mises.org has an answer. Banks are using them to buy US government bonds. Gonzalo Lira explains this in Stealth Monetization. Has the federal state captured the printing presses? It seems that way.
But Murphy and Lira argue that it’s happening under the radar. The Fed gives freshly-printed money to the banks. The banks turn around and buy government bonds. In this way, the Federal Reserve is printing dollars to pay for the enormous federal government shortfalls. Banks profit because they get the funds at a 0.25% interest rate. That’s less than inflation. Small businesses can’t compete with this arrangement. That may be one reason they aren’t getting loans, if that claim is even true. These shortfalls pay for the wars, the police state, the war on our food and other encroachments on our lives, liberties and properties.
Don’t know Federal Reserve from Federal Express? Check out this video.