End the Fed and Avoid Economic Disaster!

18 Feb
ron-paul-stock-market-bubble

End the Fed and Avoid Economic Disaster!

Today’s comments come from former Congressman and presidential candidate Ron Paul.

“The only way to avoid economic disaster,” says Dr. Paul, “is to cut spending and audit, then end, the Federal Reserve.”

Dr. Paul is a well-known gold authority with a great track record for predicting the calamities that result from economic irresponsibility.  His warnings given before the 2008 mortgage meltdown, an unnecessary tragedy that cost millions of Americans their homes, should be studied by everyone – Fed officials in particular – who insist that financial bubbles can’t be identified in advance.  

For years, as a member of the House Banking Committee, Paul would hold Federal Reserve chairmen’s feet to the fire in their official congressional appearances.

At one such hearing, Congressman Paul asked Fed chief Ben Bernanke if gold was money.

“No,” said Bernanke.

“Then why do central banks hold it?” asked Dr. Paul.

Paul’s latest warnings about economic disaster come from his February 17 column about the administration’s new fiscal year 2021 budget proposal.  He writes:

“President Trump deserves credit for proposing an 11.6 billion dollars cut in funding for the Department of State and the US Agency for International Development (USAID). Foreign aid does little to help impoverished people overseas. Instead, it benefits foreign government officials willing to do the US government’s bidding. The State Department and USAID are extensively involved in US intervention abroad, including efforts to overthrow governments….

“Even if Congress agrees to all of President Trump’s cuts, federal deficits will still be over one trillion dollars for the next several years. However, President Trump claims the budget will balance in 15 years. In order to show a balanced budget by 2035, the administration assumes three percent economic growth for most of the next decade. This level of growth is unlikely to come to pass. Instead, the current boom will likely end soon, and the economy will experience another major recession. Signs that we are on the verge of a downturn include rising homelessness and the Federal Reserve’s bailout of the repurchasing market.”

Dr. Paul observes that if Fed interest policies remain unchanged, it will inevitably lead to a dollar crisis.  If on the other hand, the Fed lets rates normalize, the debt bubble will burst.  

As we have said in these discussions, the Fed has put itself into a box.

Read Dr. Paul’s latest column HERE.