“The mother of all bubbles” about to burst?

«Мать всех пузырей» вот-вот разорвется?

When in September the Federal reserve of new York had begun to pump billions of dollars into the markets with buybacks (which banks use for granting short-term loans to each other), then said that should it be just for a few weeks. However, last Wednesday, almost two months after the initial intervention, the fed of new York pumped into this market to 62.5 billion dollars.The Federal reserve of new York continues these measures to the shortage of cash among banks never led to an increase in interest rates on non-contracted oral loans more than 10 percent, well above the target rate.Although the Federal budget deficit now exceeds a trillion dollars (and growing), President of trump and Congress are not interested in reducing spending, especially when on the nose elections. If trump is reelected, he is unlikely to change course and start to advocate for measures to reduce costs. Rather, he will perceive the victory as a sign that people support a large Federal budgets and large deficits. None of the leading candidates from Democrats are not even pretending that they care about deficits. Instead, they propose to increase spending by billions on new government programs.Strategist of investment company Blackstone Joseph Seidl calls government or “sovereign” debt bubble “the mother of all bubbles”. When it inevitably burst, leading to the collapse of the larger crash of 2008.Consumer debt, which includes credit card debt, student loans, auto loans and mortgages, currently stands at over 14 trillion dollars. These huge public and private debt exert a powerful pressure on the Federal reserve, forced as a result to maintain low interest rates or even experiment with negative rates.Says investment strategist and founder of Pento Portfolio Strategies Pikul Pento, the fed panics, trying to prevent economic problems, much worse than those that took place in 2008. “It’s not just pumping money into the economy, it’s pumping up on steroids. Because everyone knows that it is not temporary but permanent, as in any banana Republic at the moment or in the past.”Congress is not going to cut costs, while this does not require a critical mass of Americans or not will be a substantial economic crisis. In the event of a crisis, the Congress will try to avoid direct spending cuts, instead allowing the Federal reserve to do their dirty work by debasing the currency, which will only aggravate the crisis. The only way to avoid this is to spread the message and develop the movement for peace, free markets, controlled the government and secure the money.

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