YGGDRASIL

Slavery and The Federal Reserve

It amazes me that successful Euro-Americans do not instantly recognize that our tax system is very carefully tailored not only to raise revenue, but to keep people like you and I working.

Reagan's 28 percent top marginal rate was intolerable because we all would have quit (or worked for free as I do) years earlier without the Bush increases.

We live under an inverse pyramid where 3.5 million families defray 50% of the costs, and 14 million families pay 80%. The endless propaganda about equality and the sins of slavery are designed to keep us from seeing the obvious - how few of us field hands are out in the fields! Successful, productive people have become the slaves.

I can tell from some of my feedback that many readers have a tough time grasping the reality of demand deflation coupled with loose money at the same time.

What central banks have learned from the 90's is that you can gun the money supply without having the effects show up in goods prices or the CPI, and thus without increasing the government's old age pension liabilities.

This means that the monetary authorities are free to create interest rate arbitrage opportunities to prop up the banking system, and confer benefits on the financial elites without "adverse effects on main street".

Alan Greenspan started worrying about "irrational exuberance" only after hearing reports that thousands of people were quitting their jobs to trade stocks.

Greenspan isn't the slightest bit concerned about elevated markets increasing consumer demand. What he is worried about is that elevated markets will confer freedom on some of the serfs and that this new-found freedom will depress government revenues and increase pressures on wage rates by making labor scarce.

The central bank isn't threatened by stagflation because it moves people into higher tax brackets.

They do not yet fully understand that their easy money policy coupled with falling population creates opportunities for speculative currency attacks, and for extreme market volatility (and not just in the upward direction!).


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