How Much Monetary Inflation?

How much monetary inflation?


How Much Money Inflation? - Howard S. Katz - Mises Institute: "The Federal Reserve is lying about the nation's money supply (M1). The current figure for money supply is being given as $1.6 trillion. The actual number is $2.34 trillion. The reported number is equivalent to an increase of 16% over the past year. The actual number is equivalent to an increase of 70% over the past year. This compares with the nation's high money-supply increase of 16.9% in 1986."

You can read about bank sweeping - which really is fraudulent - and you'll see that most banks don't have any money.

Seven bank failures were reported today. Why those banks and not others? I guess they are the worst of the bunch. Luckily for people with accounts at those banks, other banks picked up their accounts, along with some bonus money from the FDIC. If the FDIC can't convince another bank to pick up your account, then your account is frozen, and you are in for some serious annoyance at the very least. Any automatic payments you have will fail and any outstanding checks are returned marked "bank failure." Sure, the FDIC will cut you a check but it takes a couple of weeks, so your money is not available in the meantime.

Calculated Risk has a quote from the FDIC for each bank failure. Here's one of today's:

As of April 30, 2009, Founders Bank had total assets of $962.5 million and total deposits of approximately $848.9 million. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $188.5 million. The PrivateBank and Trust Company's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. Founders Bank is the 52nd FDIC-insured institution to fail in the nation this year, and the twelfth in Illinois. The last FDIC-insured institution to be closed in the state was The First National Bank of Danville, earlier today.

Let's see... assets of $962.5 million and deposits of $848.9 million. Sounds like the bank had over $1.8 billion in stuff! But I'm pretty sure "assets" means "shitty loans" so you really need to subtract the bigger number from the smaller number to find out how underwater the bank was.

I'm trying to buy a copy of Rolling Stone magazine because of the awesome article it has about Goldman Sachs. Rolling Stone appears to be hard to purchase. I'm going to a book store tomorrow to look for a copy. You can read the article about Goldman online because someone scanned it since Rolling Stone is too stupid to capitalize on an article that makes the magazine relevant. *Sigh*.

Wait! Late breaking news! Rolling Stone has posted the article, "The Great Bubble Machine." Check it out! (I still plan to buy the hard copy as a show of support.)

[Update: a video interview with the author.]

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