When even the New York Times and CNN are admitting that the United States faces not only a double-dip recession but potentially a new great depression, any alarm bells that have not been rung should now be sounding loudly. Following in the footsteps of the New York Times’ Paul Krugman, who in June wrote that the United States had entered a third depression similar to the Long Depression of the 19th century, CNN Money carried an article yesterday brazenly entitled, Is this finally the economic collapse?. The piece, written by Keith R. McCullough, points out that the Fed’s announcement that it will start buying Treasury debt, is a “crossing the Rubicon” moment and “could lead the country to the brink of collapse”. “Crossing the 90% debt/GDP threshold is the equivalent of crossing the proverbial Rubicon of economic growth. It’s a point from which it’s almost impossible to return,” states the article, adding that the market has not responded to quantitative easing so to engage in more of the same would be completely futile. “With 40.8 million Americans on food stamps (record high) and 45% of the unemployed having been seeking employment for 27 weeks or more (record high), what’s left if (or when) QE2 doesn’t kick start GDP growth? Should we start begging for QE3? Should we cancel the bomb of the National Association of Realtors’ existing home sales report, scheduled for public release on August 24th? Or should we bite the bullet and accept that current economic policy dictates 0% returns-on-savings, even as Washington continues to lever-up our future to the point of economic collapse?” writes McCullough. The Dow Jones slipped by 265 points yesterday as both the Bank of England and the Federal Reserve indicated that, as we predicted all along, the happy clappers who blithely talked of “robust recovery” were in fact completely wrong and now that the futile and transitory life-support machine of quantitative easing has been turned off, the picture looks almost as bad as when the crisis began in 2008. Predictions on GDP growth seem to be shrinking by the day as Ben Bernanke greases the skids for QE2 – a fresh round of printing money out of thin air, destroying the long term value of the dollar which has already had 9 consecutive down weeks since June but ensuring the central bankers that run the United States continue to reap lucrative interest payments on the spiraling national debt. The U.S. government, via the taxpayer, paid out nearly $20 billion in interest on debt last month alone, as the Federal Reserve enjoys record profits, only 20 per cent of which is returned to the Treasury…. Continued at: http://www.prisonplanet.com/fed-leads-america-to-the-brink-of-collapse.html added by: Dagum
