What on earth is this book talking about? How on earth can the rich conspire against us all? And what could they conspire against us about?

-Quantitative Easing

If you have seen this phrase being used by the dear Federal chairman, Mr Bernanke, you probably thought you were in way over your head. What could we lay people possibly know about quantitative easing? First of all, they have been using this term to describe money printing. His audacity in changing the word to make it appear like some wonderful macroeconomic policy is simply outrageous. Secondly, how dare they print money to bail out the banks? The very same banks which created all that toxic financial products which got us into this financial mess in the first place? If you or I did what the Fed was doing now, we would be charged with counterfeiting and thrown into jail.

-Low interest rates

What do the interest rates mean to us? Its supposed to keep credit cheap for the banks and the banks in turn are supposed to be able to lend us more money. Business get their loans so they can, well, go about their business. Consumers get their loans to buy their houses and cars and whatever else strikes their fancy. Problem is, low interest rates also mean that inflation will set in soon, with all that cheap money flooding the market. That means that everything will become more expensive. Especially the things that matter to us, such as commodities and fuel.

At some point, the Fed will have to raise interest rates if they want to control inflation. But I know they will never do it, since the the interest payments on our sovereign debt will positively shoot through the roof.

The annoying thing is, the Fed has been toying with everyone by making all sorts of statements to the media that they are aware of the problem and they “promise” to bring up interest rates soon. Then when it seems time to actually do it, they start making more statements about the economy being too “fragile” to raise interest rates.

Reading through these statements on the Bloomberg website can really make your blood boil.

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