The Weipan Gambit

As in elements of Weimar and Japan, which is pretty much where we are after today's action by the Federal Reserve. The cutting of the fed funds rate to a target range of zero to 0.25 percent was essentially a formality, though shocking when put in perspective. The important part was the FOMC statement, which made it clear that someone with this record of complicity is asking us to trust his judgement while he prepares to do literally anything next. And in terms of records, in 2005 Dallas Fed president Richard Fisher said, "As a member of the FOMC, I will never vote to monetize fiscal profligacy." You can see how he voted today here. As long as these guys are allowed anywhere near the levers of policy, there can be no material or psychological end to the current period.

I've been writing for a long time, so far correctly, that personal savings are not safe if kept in the domestic, dollar-denominated system. In every other nation that has gone down this road, the only people whose standard of living wasn't destroyed saw what was happening early enough to protect themselves. It's barely been a year since the financial markets started to go south. What will the system will be capable of during the next five or ten?

Some theme music while we wait to find out...