Oil Price War Throws the Fed into Crisis Mode
By Pam Martens and Russ Martens
Wallstreetonparade.com
October 13, 2014
It was only a matter of time until the evidence became irrefutable that the only way out of a global deflation on the order of the Great Depression was to address the fact that 571 U.S. billionaires simply don’t have enough hours in the day to spend adequate money to buy enough goods that would require the restocking of shelves, create new factory orders and thereby ramp up job hiring to keep a nation of 317 million people afloat.
A nation where the top 10 percent reaps more than 50 percent of the income is doomed to end up in the quicksand of deflation, dragging down the rich along with everyone else. The Federal Reserve’s timidity to address this reality since the crisis of 2008, as the national debt ballooned and its own balance sheet quadrupled, has now put it in a dire pickle at a most inopportune time.
The Fed has attempted to assure the world that things are so dandy here in the “Goldilocks economy” that its biggest focus is when it will raise interest rates to keep the economy from overheating and keep inflation in check. That thesis has been quite a bit of a stretch with 45.3 million of its fellow citizens living in poverty and a labor force participation rate of 62.7 percent – a data point that has been steadily getting worse since the financial crisis in 2008.
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