The Inevitable Collapse of the World’s Economic System – It’s Coming

• The Inevitable Collapse of the World’s Economic System – It’s Coming
  by Anthony Wile, http://www.dailybell.com/  
  The world’s economic implosion is getting closer. It’s not something that is a staple on the nightly news, but it is taking place. Because it is not commonly reported, investors may not understand fully how debased the economic environment has become. Japan, Russia, China and Brazil as well as the West are all plunging economically and thus interest rates – one sign of distress – may be going lower not higher.
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  The European Union doesn’t anticipate growth and the Fed anticipates but doesn’t act as if it believes it. And now Bank of England’s Mark Carney has weighed in with his own negative forecast. From the BBC:
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  Forecasts for the first change in interest rates since 2009 have been pushed further into the future following the latest reports from the Bank of England. The Bank said that the outlook for global growth had weakened, which was depressing the risk of inflation. Economists think that indicates rates will not rise until the second quarter of next year and perhaps later.
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  The Bank once again held UK interest rates at the record low of 0.5%. The Bank’s Monetary Policy Committee, led by governor Mark Carney, voted 8-1 to keep rates unchanged. UK interest rates have now remained on hold for six-and-a-half years.
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  We went through a period when the Bank of England in aggregate burbled happily about an ongoing “recovery.” But recovery has been flushed down the so-called memory hole. Remember the “green shoots” of yore? It is all fiction, gas-baggery, monetary propaganda. There is no recovery. If the Fed raises rates it will be a tiny move upwards. But frankly, I’d be surprised even by that.
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  Just a few days ago, Yellen was quoted as saying the Fed would consider negative rates if the economy soured. Here, from Reuters:
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  The Federal Reserve would consider pushing interest rates below zero if the U.S. economy took a serious turn for the worse, Fed Chair Janet Yellen said on Wednesday. “Potentially anything – including negative interest rates – would be on the table.”
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  Yellen said the idea would have to be carefully studied but indicated that banks might be apt to lend more money if they were receiving payment for money stored with them.
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  It is really incredible that people can put credence in this kind of economic mumbo-jumbo. The point of negative interest rates is that the bank is enriched by its savers and investors. But no matter what moves are made to support banks, it is the health of the economy that will drive the demand for money and thus for lending.
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  Central bankers are extraordinarily powerful in the modern era. And for central bankers every recession is a monetary problem and every answer involves the hammer of financialization.
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  They never call it debasement, of course, because that’s a blunt term not used in the polite society of high finance. But one way or another the knee-jerk financial solution is to add to the money supply. When the business cycle is at its nadir, this solution is often described as pushing on a string.
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