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The Never-Ending ‘Recovery’

Follow along, ladies and gentlemen, as the amazing tale of the U.S. “economic recovery” is presented to readers. This journey into the surreal begins with an obvious question: how was this Never-Ending Recovery created, which (supposedly) is already roughly twice as long as any ordinary recovery, and (according to the “experts”) shows no sign of ever ending?

Any/all close followers of the Never-Ending Recovery will have no problem answering this question. It was created through the stalwart “leadership” of the Federal Reserve, under the expert tutelage of B.S. Bernanke. He printed, and printed, and printed U.S. dollars at an exponentially increasing rate, never before seen with any paper currency – which did not immediately plunge into worthlessness via hyperinflation. And those are only the $trillions which Bernanke admits printing.

More-specifically; B.S. Bernanke created all of this funny-money via the utterly meaningless euphemism we now know as “quantitative easing”. What does “QE” really mean? It means simply conjuring paper currency (out of ‘thin air’) which is not directly or indirectly “backed” in any manner whatsoever, and so cannot possibly have any value.

This explains what was done by the Chairman of the Federal Reserve, prompting the next question: why did he do it? The explanation here is “simple”, indeed utterly simplistic. B.S. Bernanke printed these $trillions and $trillions of new USD’s (more than $10,000 for every man, woman, and child in the USA) to “pump-up asset prices” in U.S. markets – primarily U.S. stock markets.

He (artificially) pumped-up these asset prices in order to create what he called “a wealth effect”. This would then make Americans feel wealthier (through artificially inflating the value of their assets), and then they would (supposedly) go out and spend, spend, spend – resulting in “the U.S. economic recovery”. Unfortunately there are numerous problems (and questions) with this particular piece of Bernanke B.S.

The first (and most-obvious) question is: why did Bernanke go this circuitous route of pumping-up asset prices with newly-printed dollars in order to make Americans “feel wealthier”. Why didn’t he simply hand every man, woman and child $10,000+? Two reasons.

The elementary answer here is that one can’t “make people wealthier” by simply printing-up and spreading-around stacks and stacks of worthless, unbacked paper currency. If it was possible to do so, Bernanke (and all the other central bankers) would simply print and hand out a million dollars per person, or a billion dollars per person – and then (supposedly) we would all be tripping over all the “new jobs” and “economic growth”. It doesn’t take any brains to turn the switch on a printing press from “off” to “on”.

So, to begin with, it is simply and utterly impossible to create (real) “economic growth” (and real economic prosperity) through such money-printing hocus-pocus. But that’s not the really absurd part of Bernanke’s lie that he “created a U.S. economic recovery” with all of his QE money-printing. To understand this requires answering the second part of the previous question: why did Bernanke pump-up stock markets, rather than simply (directly) handing everyone their “$10,000”?

B.S. Bernanke did not want everyone to “feel wealthier”. He only wanted the top-10% of the U.S. population (who own almost all that U.S. stock) to feel and be wealthier. And thus the full absurdity of this imaginary “recovery” is revealed. Recall the storyline.

Bernanke is pumping-up assets to create a “wealth effect”. He’s creating a “wealth effect” to get Americans to spend, spend, spend (and thus create jobs and economic activity). The problem with this ridiculous fantasy? The top-10% upon whom all this new “wealth” was bestowed were already very, very wealthy. In fact they have never been wealthier in the 200+ year history of the U.S. republic.

Obviously making the very-wealthy wealthier is the worst, possible use of a “wealth effect”. If Bernanke’s money-printing hocus-pocus could ever work; the people who would need to “feel wealthier” are the bottom-90% -- whose standard of living has plummeted by more than 50%, and who (in relative terms) have never been poorer.

Read more: The Never-Ending ‘Recovery’

 

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