Fed Rates Go to ZERO Soon! What NEXT?

As I have posted on my blog on September 30, 2008, the Fed will use one of their key financial tools to help jump start the economy. If $700 bln with TARP, $200 bln for Freddie Mac and Fannie Mae, about $150 bln for AIG, and another several billions to help the Commercial Paper Market, what will bringing down the Fed Rates to ZERO do?

It is almost like using a pea shooter against a bank robber. The problem is not putting more money in the financial system, it is letting the FREE Market System work!

Yeah, we can look at Uncle Sam as the EMT (Emergency Medical Technician) trying to use the defibrillator to treat a patient who has gone into cardiac arrest, but what good will it do if the patient doesn't have the proper diet, or apply proper exercise to keep their bodies functioning at optimal potential.

The problem is that Government cannot stop eating PORK or stop feeding the hungry man with fish. What they should do as well as the people of the USA is begin to be humble, frugal, and financially conscience about what and how they spend.

The ideas that should be taught is to teach a man to fish (create jobs) rather than give a man a fish (welfare mentality - both on Wall Street and Main Street). We have got accustomed to a society where adults are kids and kids are kids, not being responsible, not being able to respond to hard choices and sacrifice!

What we need to do is build our manufacturing base so we begin to have "Made in America" once again. Also, we need to pay people wages that are competitive. The problem is when we pay people unreasonable pay for lack of skill, we begin to have a working economy that is welfare based salaries. That is, when you work for less and get paid more.

It is hard to be in an economy where the unskilled get paid more than the educated and skilled workers get paid less. For example, A Real Estate Agent, goes to school for less than six months, and become licensed to make salaries or commissions greater than our skilled working sector. There should be a system where to make that kind of money require as part of its licensing process someone who has at least two year and/or four-year college degree. Some type of tier system. But, when you have less skilled, less educated people work for so much money, the integrity of the system will be compromised...Why? Same as the study have shown for someone who is less educated or unskilled winning the lottery. There is no appreciation of the hard work required to make that much money. Thus, dishonesty, corruption, and greed becomes the root of its foundation.

However you spin it, or however you word it, the failure in the system is lack of self-reliance, dishonesty, coupled with greed and staying up with the Jones.

Nonetheless, lets feed the hungry tiger with ZERO Fed Rates! What NEXT?

Increased crime, corruption, and homicide...the fruits to pride, greed, and eat, drink, and be merry for tomorrow we die mentality! What is the math equation? Zero plus Zero is ??? ZERO! Thanks to Ben Bernanke, Federal Reserve Chairman, our scholar and our gatekeeper to the financial faucet.

When will we learn? Alex de Tocqville wrote about Democracy in America. When the French write came to visit the United States, he spoke that "America is GREAT because America is Good!" It wasn't because we only generous with our money to help other nations, but because we were good because we really believe in the inscription, "In God We Trust"

Anytime a nation abandons or rejects God who gave life and birth to the United States of America, we will be wiped off the face of the land, and another will take over, a more righteous and FREE loving people with less greed, corruption, and more godliness and acknowledge His HANDS in ALL Things!

Meanwhile we will just have to settle for the Fed Rates to go to Zero soon!

When ALL Else FAILS, Cut the Fed Rates to Zero

Yes, when all else "fails", cut the Federal Reserve Rates to zero! Why not? The money is monopoly money. It no longer has the value that it had. It is a perceived value and because people are not informed nor aware of the many consequences nor do they care, why not?

Let's cut the Fed rate to ZERO! It is the next and final step to the true value of the US currency.

The US Government has no longer the credibility it use to have. When America is weakened by its financial turmoil, the next step is military weakness. Why do I say that? Because how else does an economy that has no longer the sustaining manufacturing output as a world leader begin to support itself? America has become a fat, lazy, and idolatrous nation that loves only the consumer goods provided by the imports "Made in China".

America use to be perceived as the giver of opportunity, and now its people has become the welfare, entitlement mentality culture that has brought the financial rift to its current downfall trend.

Oh where have you gone the lady of liberty? You have been sold off by its people through arrogance, laziness, and greed. Where will you bring your torch? Will the flame of liberty be extinguished because her citizens cannot pay the bill of her divorcement?

So long, farewell, and let the good times roll and bring on the Fed rates to zero!

The GOOD INTENTIONS may Deliver Mal-Intent Outcomes

Here is a quote from the article "Mad as hell- taxpayers lash out":

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And Surfta from Brooklyn, N.Y., says the government action is really not a bailout at all.

"It's NOT a bailout. The government is not handing out cash, they actually stand to make a great deal of money out of this, which will trickle down to YOU. First priority should be to try to control and fix the problem, then regulate sufficiently to make sure this NEVER happens again."

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The problem with this thinking that I quoted above is that America has no conscience. It would be wonderful if everyone played by the same rules. The reality is that people by nature are greedy, self-interest, I'll cheat if I cannot get caught.

I recall the Katrina incident when the US government gave away $2000.00 via an ATM card to the disaster victims. There were people who fed off the government and "FREE" loaded on the money and many received this aid that did not deserve it. Money was being stolen and no one knew where it had gone? Yup! No one knew where the money had gone...

This is the problem with "bailouts"; it may have good intentions but it may deliver mal-intent outcomes. There are many affected by this government "bailout" - I believe it can create a problem with the "I don't care mentality" which leads to civil unrest, more dishonesty in the financial markets, and the masses having the "I'll cheat the government, if they are going to have the welfare mentality for the rich" There is one thing to attempt to help the poor and needy with entitlements, but when you help the rich, the unfair advantage is disastrous to the economy mentality of the whole.

All I can say about this is, watch out for lawlessness among certain segments of society as the rise in the commodities and retail sectors begin to surface. The entire problem with this whole system is that the money is no longer backed by gold NOR is the inscription "In God We Trust" have any meaning. I cannot believe that a good name such as God would allow his name to be dishonored!

Like any honest businessman, when the risk is too high and fraud is part of the equation, the honest businessman will hold back the lending. Well, I believe that God will begin, if he hasn't done it already, to correct the right of the wrong from the misuse of the inscription "In God We Trust".

It is all well and good but a just God cannot stand to see his good name be dishonored! So, once again, the good intentions of the US government may deliever mal-intent outcomes yet to be seen on the surface but will already begin to poison the financial and social foundation of this nation we call, "America the Beautiful"!!!

Freddie Mac and Fannie Mae a Government Intervention

If you had money to invest, and there was a business in real estate that was going bankrupt, would you consider investing your HARD EARNED Money in that company?

If the risk was so high would you consider purchasing their stock for a possible return or NOT at all?


Here we go again. First, it was the Bear Sterns bailout with the Federal Reserve & J.P. Morgan. NOW it is Freddie Mac and Fannie Mae, the economy is so sick as it is, that our Federal Reserve is again willing to purchase a stake in the 12 trillion dollars in debt.


When will we begin to make businesses accountable for their business decisions? Why is the government being partial as to who is bailed out, and who is not? Why should the government use public money, YES! Public money, our taxes to bailout these businesses who such as the CEO of Freddie Mac and Fannie Mae make a combined salary of $19 million a year in income.

This is the GREAT American experiment...life, liberty, and the pursuit of happiness at the cost of the American people (the brunt of the weight is upon the tax payers of the middle class).


When will the American people say, "Enough is Enough!"? It is only a matter of time that our foreign investors (i.e. China, Japan, England, and others) will say, "America the beautiful, we are tired of paying for your lavish lifestyle, it's our turn to get PAID back for all the money and stuff we provide for you each and every year."


In my previous post, I mentioned Euros being accepted in New York, then, I talked about the US dollar falling against other currencies, then, I talk about investing in precious metals (i.e. gold & silver), and just the other day, I spoke about the 600 US stores that Starbucks is closing. What is next? I say, more trouble coming in the US.

We haven't begun to pay our Baby Boomers their Social Security Retirement and Medicare benefits...I believe America has to be close to Bankrupt, if NOT Bankrupt already...and, if closing the doors on the US was that easy, America would be in a deep depression. However, thank goodness for all the safety nets the US has built up & built into the system done through decades of operations.

Being the world's reserve currency is one safety net that keeps us afloat. But, when the other governments are fed up, we are in big trouble. Like when President Nixon took the US off the gold standard, or when M3 money was ceased from being published.


If Freddie and Fannie is now going to become our brothers and sisters to Uncle Sam, then where are we in this picture? -- Slaves, Servants, Laborers, and Step children to a dysfunctional American Family?!!!

Here it is another sign of the breakdown of the family unit! What NEXT..?