I'm posting this very important video again with an active link, sorry.-Lou
Watch Video Here:
http://www.youtube.com/watch?v=lNS8IY_Td14
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Lou Scatigna
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About Me
- Lou Scatigna
- President AFM Investments, Inc. Securities offered through Leigh Baldwin & Co. Member FINRA & SiPC Lscatigna@leighbaldwin.com 732-905-8100 *************Disclaimer************ These articles merely reflect the opinions of this author and are by no means a guarantee of future economic conditions. Though the author strives to provide accurate and relevant data, he sometimes relies on external sources and cannot assure the reader of the accuracy contained within. Additionally, these articles are provided for INFORMATIONAL PURPOSES ONLY and are NOT MEANT to provide investment advice to anyone. For investment advice, please consult with your professional financial planner.
Hi! This is interesting but sad .... because Glenn Beck is wrong. I am also concerned about the POSSIBILITY of the FED printing too much money but it hasn't happened yet.
ReplyDeleteWhat Glenn Beck shows is a chart of the Adjusted Monetary Base. This is equal to the amount of money in circulation PLUS the money banks have on deposit with the FED.
Glenn Beck talks like this chart is the amount of money in circulation. In reality the huge increase since the "Bailouts" began is explained by a huge increase of money on deposit with the FED.
Why are banks giving the FED money? Because they started paying banks an interest rate on reserves that is exactly equal to its target for the fed funds rate itself, essentially eliminating any incentive for the banks to lend fed funds and encouraging banks instead to simply let excess reserves accumulate. A couple of weeks ago banks were sitting on about $800 billion in excess reserves with the Fed, doing absolutely nothing with them.
The Fed was in effect lending those funds in place of the banks - there was no new printing of dollars taking place.