It wouldn’t be the first time the Fed swore it would do one thing and then did the opposite. From Bill Bonner at bonnerprivate research.com:
(Source: Getty Images)
Bill Bonner, reckoning today from San Martin, Argentina…
What a week! Another exciting mix of the absurd, the ominous and the sublimely ridiculous.
The most important thing that happened was that the Fed revealed more of its ‘stealth pivot.’ It came out with a program to bail out the big depositors of failing banks. Already, the FDIC insures the deposits of small account holders (under $250,000). Now the new alphabet group – BFTB, or something like that – is going to look after large account holders. In other words, the whole banking system is being nationalized.
Well, not exactly. The losses are being nationalized. The profits will remain with the bankers.
What’s behind it? We recall our old friend Richard Russell:
‘The feds can control the banks to a large extent. They can control the bond market, to some extent. They can control the stock market, also to some extent. They can cause booms and trigger busts. But they can’t do those things and also control the value of the currency. The dollar is the pressure value. It suddenly pops open when the system needs a reset.’
STRAIGHT LINE LOGIC 