How The Federal Reserve Is Purposely Attacking Savers

There's something we 'regular' citizens wrestle with that the elites never seem to: a sense of moral duty.

For example, following the collapse of the housing bubble, many people struggled with mortgages they could no longer afford to pay, fearing the shame of default. Many believed defaulting was wrong somehow; that it was their moral obligation to pay their mortgages, no matter how dire their personal situation. And of course, the mortgages lenders did their utmost to reinforce this perception.

In a perfect world, we would honor our debts and obligations, every one of us. But the world is an imperfect place ,and moral obligation is something that almost never enters into the decision matrix of our society's richest. Or the banking industry.

For them, the number one (and two, and three...) rule is that whatever is expedient and makes the most money is the right thing to do.

For the bottom 99%, it’s like playing with a stricter set of rules than your opponent: you’re not allowed to hit below the belt, and they’ve brought a baseball bat into the ring.

Note how this guy had to fight through his middle class conditioning before coming to a sense of peace over his decision to enter into a short sale on his house:

How a short sale taught me rich people’s ethics

Sep 29, 2014

The closest I ever came to acting like a rich person was two years ago when I short-sold my primary residence. I might have been able to keep it but strategic default made life easier. I owed about $400,000 on a house that short-sold for $150K. The bank lost more than a quarter of a million dollars, and I lost at least $80K in down payment and property improvements.

I was taught growing up to “keep my word” and that your handshake “meant something.” Yet businessmen and individual wealthy people make decisions that are far less moral than a short sale. People “incorporate” so they can avoid legal responsibility for individual actions.

It works great. You can stiff creditors, declare bankruptcy, pollute daily and raid pensions to enrich individual executives. If it all goes wrong, like it has so often for Donald Trump, you can keep your mansions and individual fortunes.

I entered the shark-infested waters of high finance with a short sale. It was the worst ethical decision, but the finest, most profitable business moment, of my adult life. It was an informative, even transformative, experience.


This poor guy has a very bad case of ‘middle class morality’. It's a very real phenomenon. All our lives, we are all taught (programmed?) to stay within the true and narrow groove of middle class life, pay our bills, and be on the hook should things go awry.

Not everybody holds that view, however. As he continues in the piece, the author discovers something important along the way:

I always knew business was getting over on me, but I had no idea the extent until I started looking to short-sell. I first learned all I could aboutprivatehome financing. I called up some shady investment groups around town and questioned them at length. I didn’t end up using them, but they were frank, informative and unashamed.

“Who would pay 11 percent on a home loan?” I asked.

“Rich people,” said “Bill” from the legal loan-sharking company. “The rich have terrible credit.”

Rich people = bad credit: Just let that sink in.

Bill told me in roundabout ways that rich people never pay a bill if there is any way around it. If something goes wrong in an investment or a business, they always preserve their own assets first.

Rich people have terrible credit. They know that there’s a system and it has rules. And, for them, these rules can (and should) be optimized for their own benefit. So they do anything and everything that works to their advantage.

There’s a reason and a logic to that which I can appreciate, but it makes me wonder where the rest of us obtained our deep-seeded beliefs about duty and responsibility towards debts.

Similar to rich people, banks do not have any entangling moral restrictions on their behaviors. That absence allows them to get away with extraordinary misdeeds, none more obvious and damaging than those that the Federal Reserve has perpetrated on the nation, specifically, and the world, more broadly.

To understand why, we first have to discuss something called Financial Repression.

Financial Repression

In my recent interview with Daniel Amerman, to whom I will credit much of the concise thinking and for unearthing the sources that I will weave throughout the remainder of this piece (please read his excellent article on Financial Repression here), the truly immoral intent of the Fed's policies really sank in.

In response to the Fuzzy Numbers chapter (18) of the Crash Course, reader JBarney pondered the following:

Thanks for putting this update together. I think one of the problems is there are so many moving parts, so many manipulated numbers it is difficult to get a clear picture. The way it is organized here is helpful.

However,I can't help but wonder about all of the implications of these numbers for the real economy and people's lives. One of the sections which really hits home was the impact inflation has on all of this. If these are the numbers now, what will it be like when things really start to change?

The answer is that while inflation always steals from savers, it really does its dirty work when the central bank and government conspire to create a condition of pervasive and unavoidable negative real interest rates.

This is the heart of Financial Repression: an environment in which you literally cannot save money without paying a penalty.

The main takeaway of Chapter 18 on Fuzzy Numbers is not that the government fibs a little now and then (okay,all the time) merely because that's politically expedient, but it does so in service to a larger and more pernicious aim: forcing people to accept an inflation rate that is higher than either their income growth and/or the market's safe rate of return.

As soon as you are locked into a negative interest rate regime, your capital is losing purchasing power. But simple accounting rules dictate that loss of wealth had to go somewhere. So where did it go? To somebody else.

Negative real interest rates transfer money from every saver to every over-extended borrower. This is especially true with the government (largely because of its special revolving door relationship with the Fed, which both issues the money out of thin air and then buys government debt forcing rates into negative territory).

It's really that simple. The Fed has openly and actively suppressed rates -- not to help the credit markets, as they claim, but to engineer a condition of Financial Repression. Because that's what the government needs to stealthily take your wealth to pay down the prior debts it accumulated.

Thus 'negative real rates' are the essential component of transferring wealth from the many to the few, with the 'few' being defined as the government, Wall Street, and others who exploit leverage and liabilities at sufficient scale to be on the right side of that wealth transfer.

This well-known phenomenon is a thoroughly accepted and well-described practice of governments and central banks everywhere. One of the better descriptions of it comes to us courtesy of the BIS in this working paper published in 2011.

From the abstract:

Historically, periods of high indebtedness have been associated with a rising incidence of default or restructuring of public and private debts.

A subtle type of debt restructuring takes the form of “financial repression.”

Financial repression includes directed lending to government by captive domestic audiences (such as pension funds), explicit or implicit caps on interest rates, regulation of cross-border capital movements, and (generally) a tighter connection between government and banks.

In the heavily regulated financial markets of the Bretton Woods system, several restrictions facilitated a sharp and rapid reduction in public debt/GDP ratios from the late 1940s to the 1970s.

Low nominal interest rates help reduce debt servicing costs while a high incidence of negative real interest rates liquidates or erodes the real value of government debt.

Thus, financial repression is most successful in liquidating debts when accompanied by a steady dose of inflation.

Inflation need not take market participants entirely by surprise and, in effect,it need not be very high(by historic standards).

For the advanced economies in our sample, real interest rates were negative roughly ½ of the time during 1945-1980. For the United States and the United Kingdom our estimates of the annual liquidation of debt via negative real interest rates amounted on average from 2 to 3 percent of GDP a year.


Let me decode that.

  • Step 1: Governments get into trouble by borrowing too much.
  • Step 2: Rather than pay this down honestly via cutting spending (unpopular) or by defaulting (even more unpopular), the government conspires with the central bank to slowly liquidate the stack of obligations by forcing negative real interest rates on everyone.
  • Step2bHang on one wouldn’t work if people could dodge the Financial Repression, so a ring fence has to be built out of capital controls and explicit rate caps on and across the whole spectrum of interest-bearing securities.
  • Step 3: Sit back and wait for everyone with savings to contribute their purchasing power to those who issued the debts, be those public or private entities.

And this is exactly what has happened. All of the talk about the Fed focusing on unemployment or inflation or whatever are red herrings. What the Fed is really trying to do is to create a set of macro conditions that will allow the federal government to slowly crawl out from under a pile of debt and entitlement obligations that it literally can not pay by honest, above board means.

I guess if we were to imagine a "Step 4" in the above process, it would be to wait for the head of the central bank to come out and deliver a speech in which she expresses a grandmotherly concern for the wealth gap that naturally results from all this, but to deflect attention away from this being a direct and understood consequence of the Fed's intentional goal of financial repression and towards some failure on the part of those who have been targeted to donate to the cause of bailing out the profligate and rewarding the borrowers.

Oh, wait. That did just happen. Here it is, Step 4, courtesy of Janet Yellen last week:

Why Fed Chair JanetYellenis “greatly” concerned about growing inequality

Federal Reserve Chair Janet Yellen on Friday expressed deep concern over widening economic inequality in the country and called for tackling issues such as early childhood education and encouraging entrepreneurship to help narrow the gap.

[Comment:Oh boy...must contain my emotions...did she really just deflect the consequences of the Fed's policy of financial repression towards 'early childhood education? Yep. That's like a burglar saying that we need to invest in better metallurgical processes as the means of preventing doors from being kicked in so easily.]

In a speech at the Federal Reserve Bank of Boston, Yellen said steady growth in inequality over the past several decades represents the most sustained rise since the19thcentury.Living standards for most Americans have been “stagnant,” while those at the very top have enjoyed significant wealth and income gains, she said.

[Comment: Glad the Fed finally noticed that those at the very top have been making out like bandits! This was something I said explicitly would happen as a consequence of future Fed printing back in 2008 in the Crash Course, before the printing even started. How is it that I knew that this would happen back in 2008 and the Fed is just now noticing this observationally? Is my research department better than theirs? In fact this is a very well known and easy to understand process. That the Fed is feigning ignorance speaks volumes about how ignorant they believe we all are. This is a sure sign that we are trapped in a dysfunctional relationship with an abusive partner.]

“I think it is appropriate to ask whether this trend is compatible with values rooted in our nation’s history,among them the high value Americans have traditionally placed on equality of opportunity,” Yellen said in prepared remarks.

[Comment: Once we accept that the Fed is openly and specifically creating the wealth gap as a matter of active and ongoing policy, which it is, then it's actually more appropriate to ask if the Federal Reserve is compatible with values rooted in our nation's history. The answer, obviously, is "no."]

The problem of inequality is an unusual topic for the leader of the Fed, if only because the central bank’s ability to address the issue is limited.

[Comment: Stop right there Washington Post! You've just inserted an assertion that might as well have come straight from a PR press release from the Fed. I, for one, refuse that claim and reject it completely right here and on grounds that hardly have to be substantiated, but I will just for fun. When the Fed buys 'assets' (really debt instruments) from major financial firms using freshly printed money they are,by definition, buying those assets at steadily increasing prices which means that those who hold the largest amounts of these assets get the richest. When the Fed secondarily targets the stock market as something to 'go up' and the top 5% own 82% of all stocks, then the Fed's role is anything but 'limited.' It is direct and proportional and they are 100% responsible for any and all gains that accrue to the top via the 'miracle' of asset inflation. Period. End of story. See also any of the innumerable charts plotting the S&P 500's rise along with the growth in the Fed balance sheet for further confirmation. Sorry Washington post, assertion denied!!]

Yellen listed four factors that can influence economic opportunity: investing in education for young children, making college more affordable, encouraging entrepreneurship and building inheritance.

[Comment:OMG. She just blamed the victims and did it in a very let them eat cake kind of way. How aggravating(!). According to Yellen, if people are finding themselves getting poorer what they need to do is stop scrimping on their kids, become an entrepreneur and then somehow go back in time and have rich parents. This statement of hers calls for pitchforks and torches. Literally. Without a shred of decency, she has shifted all blame from the Fed to the victims. How corrupt or morally adrift does someone have to be to blame their victims? In a criminal case this would be used as evidence of sociopathic if not psychopathic behavior and used by a prosecutor to call for a maximum sentence to prevent a dangerous individual from running loose in society. And rightly so. Such individuals are poor prospects for rehabilitation.]

Yellen did not address in her prepared text whether the Fed has contributed to inequality.

[Comment:No surprise there. Ted Bundy never acknowledged the harm he caused either.]


At this point, based on Yellen's testimony, I think it's time to say what everybody is already thinking: the Fed Chairwoman is literally displaying psychopathic tendencies by blaming her victims. I'm serious: if the Fed were an individual, we’d have no problem identifying its behaviors in psychologically pathological terms.

I understand that some, or perhaps many, will excuse this last point by saying that the Fed cannot possibly state the truth because doing so would create loss of confidence or public anger. But I submit that the so-called "white lie" defense is utter nonsense.

A greater harm is done by lying than by telling the truth. You can get away with small lies for a while, but they never actually go away, they just sit there corrosively undermining the very foundation of trust upon which civilized society rests. Large lies just do more damage over a shorter period of time, and that’s exactly where we are today. This explains much in terms of people’s general sense of unease despite an apparently reasonable economy and awesome living standards (by any historical measure).

Here's what truth would sound like if I were to re-write Yellen's speech:

My fellow Americans. Decades of poor fiscal restraint and accommodative monetary polices have brought us to an uncomfortable juncture.

My intention today is not to cast blame – there will be plenty of time for that later – but to take stock of where we are so that we can all decide on the best course forward, openly and honestly, as should be the case in a democracy.

There are no easy choices at this point, only a rather poor range of options spanning from somewhat unpleasant to potentially catastrophic.

The heart of the matter is simply this: the US government has built up an extraordinary amount of public debt, and an even larger pile of unfunded liabilities.

There’s simply no way for those to all be paid back under current terms. And given recent trajectories in play with respect to economic growth and deficit spending patterns, those debts and liabilities are only growing larger with time.

Quite simply our choices are these:

  1. Pay down the debt by taking in more revenue than expenses. This is also known as austerity and given the size of the debts and other obligations, several decades of severe belt tightening would be required. This program would be extremely painful for nearly everybody and would require massive tax hikes coupled to major spending cuts.
  2. Default on the debts and obligations. This simply means not paying people, investors, institutions and countries what we have promised to pay. Down this path lies the potential for massive destruction of our financial and political systems, so we have chosen to not entertain this path any further than to mention it exists.
  3. Do nothing and wait for a fiscal and monetary accident to happen. This is a guaranteed disaster that could result in the sudden and permanent decline of opportunity in this country that would be so painful we cannot even predict the possible outcomes.
  4. Engineer conditions where negative real rates of interest slowly allow the government’s obligations to fall relative to inflation. Over the span of decades this is the least painful route and our country has been down this path before.

We’ve selected path #4 as the least bad option. Since 2009 our policies have been geared towards #4 and we see no alternative besides staying on that path for as long as necessary. The alternative is the literal bankruptcy of our nation and we cannot and will not allow that to happen. Not on our watch.

While path #4 is the least objectionable of them all, it comes with its own share of unfortunate consequences and injustices. At its heart, negative real interest rates are an effective tax on savers and those whose incomes fail to keep pace with the inflation we are creating as an overt act of policy. This generalized and widespread loss of purchasing power takes a little bit from everyone, rather than a lot from a few systemically important institutions such as your federal government, which spreads the pain widely, and therefore causes the least disruptions to our daily lives.

Path #4 has a name: Financial Repression. This policy combines negative real interest rates with various forms of capital controls and tax policy to assure that nobody can evade it.

Obviously this is not fair, nor is it in alignment with our national narrative of prudence and hard work being rewarded because, truth be told, it rewards the profligate and those who produce nothing of real value but can play the game of high finance well. Yet here we are without any better options before us, and so we reluctantly chose Financial Repression.

One other distasteful ‘feature’ of the program of financial repression we’ve been putting you all through is that the rich get richer. Until or unless there is a massive change to the taxation and wealth re-distribution programs of the federal government, the Federal Reserve’s program of Financial Repression will continue to deliver an ever-larger gap between the wealthy and everyone else.

Such is the nature of the compounding function combined with the inequity of who gets first access to the newly created funds we make available in order to drive the interest rate curve into negative territory.

Are there any risks to this program? Well, the largest of them really needs to be discussed. Financial Repression has worked in the past, but it has only worked because we experienced both inflation and economic growth in equal measures.

Today, for reasons that we are still studying, neither the wage growth necessary to incite the sort of inflation we need nor economic growth have arrived as we thought they would.

If economic growth does not return, then the entire program of financial repression could well fail, and fail spectacularly. Everything depends on a return of economic growth sufficient to service the vast increases in debts that will result from the program.

But if that growth does not materialize? If the world is now stuck in a ‘New Mediocre’ of low growth then one risk is the possibility of a crisis that will be rooted in a permanent loss of confidence in debts of all forms, but government debt specifically. Down that road lie currency crises, and a wide variety of related financial upheavals the final result of which is what most will experience as a massive destruction of wealth.

We are working hard to assure that these risks are well contained, but you should be aware that they exist

After all, this is all of our futures that we are experimenting with and we do not have a playbook that we can follow here in 2014. We are in wholly uncharted territory. The exact arrangement of conditions we see across the global landscape is brand new.

We’re sorry to have to be in the position of engineering Financial Repression, but we felt there were no other options before us and we hope that you agree that a slight yearly discomfort to almost everyone is preferable to a major disruption to our way of life, our political system, and the possibility of worse things.

Is this fair? No. Was it avoidable? Yes. Is there anything we can be doing differently today? Not that we are aware of. The choices are between bad, worse and utterly terrible. We're choosing the bad path, and we hope you’ll agree that this is the best we can do at this point.

But you deserve the truth because it’s already completely obvious and available for anybody with access to a computer. Since we are all in this together and we’re all being asked to sacrifice in some way, it's much better that we all agree on the treatment plan.

It’s not a perfect plan, far from it. But considering the alternatives, this is the best one on the table.

If you want to make it more fair, more equitable, and with an eye towards building to a future in which we can all share some hope, you’ll need to turn to your policy makers and ask them to work from the fiscal side to correct what they can. Without a profound realignment of priorities, we’ll just get more of the same and, truth be told, eventually more of the same turns into a fiscal and monetary disaster about which nothing can be done except absorb the pain and loss that it will bring.


Context is everything. The growing gap between the very wealthy and everyone else is a consequence of Fed policy.

Whether you decide to be shocked, angry, or scared by Janet Yellen’s recent speech is up to you. Personally, I'm pissed off at being lectured to that falling further behind the super wealthy is my fault for not investing enough in my kids, not being entrepreneurial enough, and not having wealthy parents.

That level of ‘blame the victim’ is psychopathic, utterly appalling, and I reject it on every level. Worse, the level of trust destruction that happens with such a tone-deaf speech stains our entire national leadership. It is the modern version of Let them eat cake.

Once an institution, be it royalty of old or the Fed today, gets so far off the rails that they cannot locate their own role in the misery they see around them, it’s a sign of a huge problem for that society.

Ms. Yellen should not be allowed by anyone to get away with such a patently and provably false set of arguments. She should have been soundly booed off the stage and the President should be asking for her resignation immediately.

But we’re so far down the rabbit hole that almost nobody blinked an eye at the speech, and thought it perfectly normal.

For you personally, you need to be aware that the debts, deficits and liabilities across the entire OECD world are continuing to grow at a far faster pace than GDP, and far faster than oil production and discoveries of low-cost oil reservoirs (those schooled in net energy understand this to be the real issue), and that the most likely outcome, someday, will be an extraordinary financial accident.

It will be called something else -- a period of wealth destruction -- but for those who can see it coming, it will actually be period of massive wealth transfer.

And we'll keep up our efforts on how to see clearly amidst the intentional obfuscation, to help those aware to the situation avoid ending up on the wrong side of that transfer.


~ Chris Martenson

This is a companion discussion topic for the original entry at

Honestly, it's the way savers that are elderly are getting hurt that angers me the most. My in-laws, in their 80s,  are only suffering-free because they had immense savings to begin with, but it's affecting their capital - of course. I'm the only person in the family my father-in-law takes financial advice from, and it's almost all due to the schooling I've gotten here a Peak Prosperity.
Let's hope a little financial sense breaks out in Washington and around the world, but I am not holding my breath.

My husband (80s) and I (60s) were just discussing how much income we would have if interest rates were 5% the last 5 years. We would be in a completely different financial situation, with room to spare in educating the kids we adopted and living comfortably. Now I will likely outlive the money and have to live with one of these poor kids, drooling and babbling. Sad. This is while the bankers buy yaghts and fine art. To the barricades. Seriously.

Great article, I especially like your version of Yellen's speech.  :slight_smile:
The issue I see is, this isn't just a sovereign debt issue, the way it was last time (i.e. after WW2).  We also have a private debt issue too.  And peaking resources.  How does that affect the plan?

Here's a chart of "effective real rates" that I generated using my longest-lived time series.  Its imperfect (since it uses the normal CPI) but its interesting anyway:

GS1: "1 year treasury rates"


In the US corporate world and the US military, when it becomes generally known that the leaders have led the institution into such a predicament as you describe (your hypothetical honest Fed Chair speech) it is common practice to terminate the CEO or the commanding officer and a significant number of second level executives.  At least, in the past that's often what happened.  (In Japan, the tradition is much more severe and requires the suicide of the executive!)  And it makes sense: they steered the ship onto the rocks so they can't be trusted and should be sacked.  To leave them in place is simple moral hazard.  This sometimes still happens in the US military, but it has become quite rare in US politics and corporations.  In fact, the politicians get reelected and the corporate leaders get huge bonuses.
If we don't find an honorable and legal way to jettison, shame and punish those who led us into this predicament and install new, untainted leaders, there may come a time when they are removed by mob violence or civil war.  I think I can see which path we are on.  "To the barricades" indeed.

"Welcome to the Hunger Games.  And may the odds be ever in your favor."

Great article as usual. It's tragic that people – even my extended family who I consider to be above average intelligence and education – have absolutely no idea what's going on. The good news is, it's all careening towards a collapse of the paper money system. My children (3 and 5) won't have to pay these debts because they are denominated in a currency that will be inflated away. Message to savers: Save precious metals. I don't see any other way for this to end then a return (post-collapse) to gold-backed money.

 Susan Forward & Donna Frazier refer to FOG in "Emotional Blackmail: When the People in Your Life Use Fear, Obligation, and Guilt to Manipulate You."  Now I see the Fed is committing emotional blackmail with full malice aforethought.
I find that righteous rage (my own and others) helps pull me out of the FOG so thank you Chris.

Add another one to the list.  
Turning the hook towards Peak Evil.

[quote=Wendy S. Delmater]Honestly, it's the way savers that are elderly are getting hurt that angers me the most. My in-laws, in their 80s,  are only suffering-free because they had immense savings to begin with, but it's affecting their capital - of course. I'm the only person in the family my father-in-law takes financial advice from, and it's almost all due to the schooling I've gotten here a Peak Prosperity.
Let's hope a little financial sense breaks out in Washington and around the world, but I am not holding my breath.
I have to confess that this entire subject really gets under my skin.  Perhaps it's the whole Virgo/scales-of-justice thing, but the fact that the Federal Reserve decided to throw savers and those living on fixed incomes under the bus in order to repair big bank balance sheets and enable greater government deficit spending is just maddening.
And to rub salt in the wound, the big banks went ahead rewarded themselves with record bonuses in the years that followed.  You know, because they deserved it.
Through it all the Fed acted dumb, pretending they had nothing to do with the big bank's behavior or bonuses and disavowing any connection to real hardship being experienced by those living on fixed incomes.
Ever been lied to by someone when you know and, worse, you know they know you know it?
Well, I find that a maddening experience, and that's exactly what Ms. Yellen is doing here.
Banks' new motto:  "Heads we win, tails you lose!"

So how do you beat a negative interest rate environment?  How do you profit from the conditions of financial repression?
we all know that gold effectively pays a coupon when real interest rates are negative by a greater percentage than storage costs.  So that's one option, what are others?

Forget about growing your savings (that's what they want you to do).  Your financial security is a fraction: savings/expenses.  If you want to make that number grow, focus on reducing your expenses.  Reducing a denominator does a lot more damage than increasing a numerator.  Cost savings return is more valuable than investment returns.

Borrow money, (aligning your interests with those of your government) and use the money to invest in "cost reduction" rather than "pile expansion."  Solar panels might give you an 8% IRR. That's a much more secure return than the stock market can promise, and it hits you in the denominator.  Just make sure you keep enough money liquid to cover the debt, otherwise the next shakedown might cause you to loose your asset.


Your incremental $20K should go on your roof, not into the stock market.  Or if you want to be more aggressive, put the incremental $20K into the stock market, borrow against it, and buy solar panels with the borrowing.  If the market tanks, just default on the loan and surrender your stock portfolio.  But don't forget to incorporate!

Great article!  The analysis of Ms. Yellon's speech was very interesting.  I cant help but wonder if someone didn't write the speech for her as it's hard to believe someone in her position can be so apathetic, arrogant and insensitive. Glad Dr. Martenson wrote about her speech.
Edgar Allen Poe's short story "The Fall of the House of Usher" in my mind, is a great analogy for what is going on today. I remember the 1960 movie "The House of Usher" with Vincent Price. Set in a magnificent mansion the "decay" of the Usher family is paralleled by the disintegration of the mansion. It was thought that the house and the family shared a soul. The dreary landscape around the Usher mansion is compare by the narrator to the sickness caused by the withdrawal symptoms of someone addicted to opium.

Our leaders, the Fed and the Central Banks and all of us are inexorably linked.  We, I believe, all make up the soul of our nation and like the sick Usher family and the mansion that slowly dies through self destruction our nation is slowing dying. Just as there was a reference to opium we too have many  addictions - to money, power, control, being entertained, to name a few and our withdrawal will be painful. The disintegrating house and destructive behavior of the Ushers symbolize our country, at least in my mind. 

Thankfully, due to PP, those of us who regularly follow this website have been given the gift of insight so we have some time to prepare ourselves before the mansion collapses.

Thanks for taking the time to share your thoughts.

AK GrannyWGrit

My "graph head" made me do this to this graph, so I thought I should share —
Green means savers are 'winning'
Red means savers are 'losing'  

[quote=Sterling Cornaby]My "graph head" made me do this to this graph, so I thought I should share —
Green means savers are 'winning'
Red means savers are 'losing'  
My eye's did that for me, but less well.
Also, as Dave warned, his chart uses CPI to draw the winning/losing line.  
Feel free to mentally adjust that line upwards as you see fit.  By my rough eyeball estimations, moving that line north by 1% means that most of the time savers were losing.
A 2% hike in the line means that on average, over the last 60 years, savers were losing.
This is why misstating the CPI by 1% or 2% is really a very big deal.  I know a single percent doesn't sound like a lot, but it really is.

Could you graphing gurus use the data series to create those great graphs.

If the debt service and entitlement payouts race ahead of the the inflation gambit is that the end game ?
The other issue is that if enough people catch on to the gamed system walk away from their obligations will this eventually lead to overall civil upheaval ?  Why work if the accepted norm is to simply take what you feel is entitled to you.

(Loki from The Mask)

Lizards, Lies and Larceny.

(Reality ends here. Please mind the gap.)

I have listened to this hypnotic computer voice twice. The first time I fell asleep, so I plowed through it again with determination.

Let us leave aside the issue of literal truth for a moment and concentrate on the content of the deepest workings of one of one of our finest schizophrenic minds.I choose to interpret the artwork as a metaphore. My amateur analysis is this:-

  • There are "superior beings" (The uber rich and their marionettes. The Deep State.) who really understand what is going on and are ruthlessly exploiting their creation, the profoundly moral and profoundly thick humans.
  • That there are various groups of these lizards that are going to wage war using their livestock. (That's you baby)
  • And that there is some energy technology waiting in the wings, but we have been bred to be too stupid to understand it.
The reason I put finger to keyboard is to emphasize that at a deep psychological level the great unwashed understand the situation and are expressing their understanding in the usual way that these things come out- in UFO's, Lizards, aliens, gods etc.

This phenomenon should be taken seriously because it is these cattle who have the pitchforks. It is the Common Meme.

One last comment:- Make use of the fact that a strawman was created at your birth in order to circumvent your Common Law rights and to burden you with Corporate law. This avenue is available to all of us.


Here is the chart using the Shadowstats CPI.  I don't believe in the whole shadowstats CPI - SS CPI right now is 9.08%, and that doesn't agree with the billion prices project, which I think is probably the more accurate representation of actual price inflation in the US.  I also don't agree with the standard CPI-U, and Chris's main point that 1% matters a whole lot over a 30 year period is quite important.

Savers (almost) always lose, since savings income is taxed at ordinary income rates.

And that's one of Dan Amerman's main points.  We must pay attention to actual after-tax rates of return when looking at financial repression, since that's one of the government's tricks.  They effectively tax inflation.

He's got some good math that shows this.

[quote=cmartenson]A 2% hike in the line means that on average, over the last 60 years, savers were losing.
This is why misstating the CPI by 1% or 2% is really a very big deal.  I know a single percent doesn't sound like a lot, but it really is.
Maybe this is why the mainstream educational system has been in a nose dive.  Maybe the intent is to purposefully have an uneducated populace.  I was talking to my girlfriend about her kids and some difficulties they were having in school.  I told her to get the textbook & I'd help them out.  To my surprise, the kids had no textbooks.  I then started talking to my colleagues at work, and they told me about the new core curriculum and the insane way math is taught these days.  One example was that of linear lines.  Instead of teaching y=mx+b and learning about the slope of a line, the kids were being taught to literally guess the value of y without solving the equation.  My physician/engineer friend said his daughter was literally scolded at school for giving the exact right answer after he taught her the real way to do it.  I heard similar stories from no less than 5 other physicians & 3 of them were also engineers.  When things seem to be totally insane I always question why.
I hate to think in terms of conspiracy theories, but it's hard for me to not consider nefarious intent when it comes to what's being taught in K-12 these days.  Has anyone had similar thoughts?