The Biggest Mistake in Our Nation’s Financial History

Andy Snyder|September 30, 2021

There’s a growing risk to the financial system.

In the words of one outspoken senator this week, it is a “grave concern.”

You’ve likely heard that two presidents of independent Federal Reserve branches quit their jobs this week. They were dabbling in assets they shouldn’t have been. They owned some of the stuff the Federal Reserve was pumping up.

The headline writers failed to make an easy connection, though.

In our mind, it’s all a wash. Because at the same time the Fed was pumping up these folks’ stocks… it was also slashing at the value of the money in their pockets. And all of our pockets.

There’s been no mention of the fact that each time the Fed votes to pump out another trillion dollars, the punch behind the paychecks for just about everyone gets that much weaker.

As we’ve been saying, anybody who doesn’t at least try to stay ahead of the monetary debasement by investing in stocks is a fool.

We don’t want fools in charge, do we?

At least when the cronies are buying, we have somebody to follow.

She’s Mean

But it’s not a couple of insiders pumping their books that has us concerned. And it’s not even the 130 or so federal judges who have committed similar acts.

Nope… there’s another “dangerous man” who has made beads of sweat form on our ever-expanding forehead.

While Janet Yellen and Jay Powell testified in front of a Senate panel this week, Elizabeth Warren worked on her reelection campaign.

She blasted Powell, the Fed chief.

“Your record gives me grave concerns,” Warren said. “Over and over, you have acted to make our banking system less safe, and that makes you a dangerous man to head up the Fed, and it’s why I will oppose your renomination.”

Warren, always one to push a new rule for a new problem, doesn’t like what Powell has done for banks. He’s slashed too many regulations, she claims.

“So far, you’ve been lucky. But the 2008 crash shows what happens when the luck runs out,” Warren said.

By now, even Yellen’s palms are likely sweating.

Don’t forget: She, too, was an accomplice in this heist.

And it’s not just one side of the aisle that’s going after Powell. These days, it’s everybody.

In the testimony that preceded his chastising by Warren, the Fed boss was forced to admit that the inflation he said would be temporary has turned out to have more of a life than he expected.

A roaring “duh” could be heard all across corporate America.

As we told an interviewer earlier this month, the market and the financial historians will soon come to realize the biggest mistake in modern monetary history…

Write This Down

Powell and his gang assumed the pandemic would stir trillions in debt write-downs, like we saw in 2008. This assumption gave them the runway to print trillions in new cash.

Now that the capitalist system has proved far mightier and far smarter than these academics gave it credit for, they’re dealing with a system that has far too much cash in it.

This could have been prevented… if only Washington had stepped aside.

But that’s what’s so troubling.

Powell’s chances of keeping his job when his term runs out early next year are nil. With a lousy track record, a monetary disaster in the making and now a scandal with his direct reports… he’ll be on the six-figure speaking tour in months.

But who does a person like Warren support to replace him? What kind of feel-good nomination will Biden make?

Oh boy…

Most folks worry about the Supreme Court and its politics. But there are nine souls on that panel. When it comes to the king of your money… there’s just one.

And if you think Powell is bad… we dare you to think about what political lackey will come next.

Think there’s a reason the Fed presidents quit their jobs instead of selling their stocks?

They know what’s happening.

It stinks.

The only option is to hold your nose and keep buying.