Pondering thoughts – why is the Fed is raising interest rates?
Was thinking about this and wondered why no one else is stating this? Simply, raising rates help fight economic inflation caused by too much money in the systems. What we have is supply side shortages causing inflation, what the Fed has just done is to give it’s patent the wrong drug. These people have to know this… Its not my job and I know this…. This is why I keep saying this is all intentional and they are trying to crash the economy.
We could put an end to the blockage in the strait of Hormuz, my god, our military could dominate the cost and inland of the cost by 100 miles and open the strait? We don’t need Iran to agree, we just do it… Since Saudi Arabia sells oil in US dollars, they are involved too, we used to have an agreement to protect Saudi Arabia for selling oil in US dollars, which just expired. I don’t know if this is the only reason why but they asked for help from the US to protect their East/West pipeline and we said no.
All of this seem to make matters worst for the dollar, I think the government knows the dollar is toast. Enter stable coin, this is digital money that can be controlled… Remember the $5000.00 Trump promised if the Republicans win the midterm, the caveat, it must be spent in the US. How the hell is he going to do that without giving everyone $5 in the new digital dollar? Oh wait, what?
I think all roads lead to a new dollar…
We could put an end to the blockage in the strait of Hormuz, my god, our military could dominate the cost and inland of the cost by 100 miles and open the strait? We don’t need Iran to agree, we just do it… Since Saudi Arabia sells oil in US dollars, they are involved too, we used to have an agreement to protect Saudi Arabia for selling oil in US dollars, which just expired. I don’t know if this is the only reason why but they asked for help from the US to protect their East/West pipeline and we said no.
All of this seem to make matters worst for the dollar, I think the government knows the dollar is toast. Enter stable coin, this is digital money that can be controlled… Remember the $5000.00 Trump promised if the Republicans win the midterm, the caveat, it must be spent in the US. How the hell is he going to do that without giving everyone $5 in the new digital dollar? Oh wait, what?
I think all roads lead to a new dollar…
How is it possible my 32 yr old house (I bought new)... I worth 4 TIMES what I paid for it???
It's not. The dollar in 1994 was simply worth 4 times more than it is now.
Here: A Burger King Whopper meal cost $3.49 in the mid-1990s and costs $11.49 today. A gallon of gas averaged $1.11 in 1994 and averages $4.48 today
it looks pretty consistent... Doesn't it!
And get this. You owe taxes on your capital gains CAUSED by inflation. What a friggin' scam!
Limiting loan availability only to borrowers that have the best credit instead
would accomplish the same goal (assuming that is actually the goal, ha-ha)
without fanning flames of inflation in higher debt service.
But that would negatively affect the banksters ability to steal the maximum amount
from the productive.
Side effect: it would also reduce the interest cost of government borrowing
which is another siphon of wealth from taxpayers to parasites.
ChatGPT response:
1. What happens when a bank lends $100,000?
Assume a commercial bank approves a $100,000 loan and credits the borrower's checking account.
Bank balance sheet Change
Assets: Loan receivable +$100,000
Liabilities: Customer deposit +$100,000
Net change in bank equity $0
Notice something interesting:
The bank has created a $100,000 loan asset and a corresponding $100,000 deposit liability.
The bank's balance sheet has expanded by $100,000 on both sides. The bank has also created $100,000 in new deposit money.
However, its equity (capital) hasn't increased.
That distinction becomes important when we discuss how much additional money the bank can lend.
2. Where the 90% idea comes from
You're probably referring to the traditional fractional-reserve banking model.
Historically, textbooks commonly illustrated banking with a 10% reserve requirement:
- A customer deposits $100,000.
- The bank keeps $10,000 in reserves.
- The bank lends $90,000.
- The borrower spends the $90,000, which is deposited into another bank.
- That bank lends $81,000, and the process continues.
This describes the traditional deposit multiplier model.
However, that isn't how modern US bank lending is mechanically constrained.
Since March 2020, the Federal Reserve has maintained a 0% reserve requirement on transaction deposits.
Banks are instead constrained by capital requirements, liquidity requirements, credit risk, funding costs, profitability, and regulatory supervision.
3. Can a bank keep expanding its assets through lending?
Yes, provided it can satisfy its funding, capital, liquidity, and other constraints.
For example, suppose the bank originates three loans:
Transaction Loan assets Deposit liabilities
First loan $100,000 $100,000
Second loan $90,000 $90,000
Third loan $81,000 $81,000
Total created $271,000 $271,000
This assumes all three loans initially create deposits at the same bank and none of those deposits has yet been spent or withdrawn.
The bank hasn't multiplied an existing $100,000 asset into $271,000. Instead, it has originated $271,000 in separate loans, creating an equivalent amount of deposit liabilities.
If customers transfer those deposits to other banks, the originating bank must settle those payments using reserves or other funding arrangements.
The Federal Reserve Bank of Philadelphia explicitly describes this process of loans simultaneously creating assets and deposit liabilities.
Federal Reserve Bank of Philadelphia
4. The critical distinction: assets versus capital
Banks don't generally lend 90% of their total assets. Regulatory capital requirements are based on measures such as risk-weighted assets, and liquidity requirements operate separately.
A bank with $10 million in assets and $9 million in liabilities has $1 million in equity capital. Creating another $1 million loan doesn't create additional equity capital. It increases both assets and liabilities while potentially consuming some of the bank's remaining regulatory capital capacity.
And there's another important point: the money created by lending is extinguished when the loan principal is repaid.
the UK's central bank
The Federal Reserve confirms that US reserve requirement ratios have been zero since March 26, 2020.
Reserve Requirements
5. Why this matters economically
Your underlying observation is significant: commercial banks can expand the money supply by extending credit, without first receiving an equivalent new deposit from a saver.
That creates a relationship between credit expansion, asset prices, economic activity, and potentially inflation. Conversely, repayment and contraction of bank credit can reduce deposit money.
Reading The Creature From Jekyll Island (long ago) explained it well, too. 👍
It is legalized theft (after the bankers had corrupted the con-gress.)
I think we will take part in its destruction - unfortunately its going to take meany of use with it.
CitiBank had a 42 Lever Ratio.
They borrowed against their "assets" (or loaned out the same money), 42 times.
So, when they make 10% on loans, but have a 42 Lever. The were making 420% PER YEAR.
Problem when housing prices dropped 5% (times 42), they lost 210% of the original money.
And that's when/why bailouts had to happen.
Leverage Cuts both ways. 10x was the old norm, so you made a 3% spread x 10 = 30% on your capital.
But greed takes over!
• 1963: A median new U.S. house cost about 505 to 509 ounces of gold (when gold was fixed/low around $35/oz and median home prices were under $18,000).
• 1970: A typical home cost roughly 714 ounces of gold ($25,000 home price at $35/oz).
• 1980 (First Low Peak): Following the 1970s inflation wave, the cost to buy a house bottomed out at around 80 to 100 ounces of gold.
• 2000–2001 (Peak Ratio / Most Expensive for Gold): Because gold languished in a bear market while real estate boomed, a home peaked at roughly 450 to 545 ounces of gold (gold traded near $279/oz).
• 2011: A median home required about 105 ounces of gold.
• 2016 (Q1): A median home required about 260 ounces of gold (gold at ~$1,201/oz).
• 2022: As nominal home prices surged post-pandemic, the ratio reached roughly 171 to 227 ounces of gold before gold prices accelerated.
• 2025–2026 (Current Trend): Rapid gold price appreciation (surpassing $4,000+ per ounce) pushed the ratio down to a range of 86 to 142 ounces of gold, marking one of the cheapest historical eras to buy a house using gold.
means our money is becoming worthless
But we have MORE millionaires than ever.
LOL
Look at the M1 money supply chart. It’s parabolic and it mirrors the devaluation of the dollar.
I don't understand your positioning, can you elaborate? I know money supply causes it as well but both are root causes. "Too much money chasing too few goods". We are speaking about the too few goods; the average house hold doesn't have too much money. Rising interest rates doesn't fix this problem, IMHO. Every time a bank makes a loan, it creates money out of thin air. They then charge you for the privilege of using this money. This increases the supply of money in the economy but your saying that if it wasn't for the money supply the prices couldn't rise? This concept is called demand destruction and its horrible. I do think we are on the doorstep of demand destruction, just like what happened right before the housing crises. Oil spiked then collapsed to record lows; this is because no one had money to pay the prices. This is a failed economy.
If your money is in a savings account I'd guess your yield is probably about 5% what inflation is, 1/20th. This HAMMERS the working middle class.
A note is a written, legally binding debt instrument in which a borrower makes an unconditional promise to pay a fixed or variable sum of money to a lender either on demand or on a specified future date.
We pay 6% per annum for all outstanding “notes”.
The system is designed to fail. Trump is creating an income based system to replace the debt system that has enslaved the people. Recent appointee to assist the Treasury Sec Bessent is Judy Shelton she has a plan to restore sound money….hint Gold.
Dec 12, 2018 6:57:57 PM EST
Anonymous ID: 376ff2 No. 4280876
>>4280189
Q: Do we have the GOLD?
>>4280876
Yes.
GOLD shall destroy FED.
Q
Team Trump MUST break the international bankers.
Vs. The Banksters.
They are trying to damage Trump.
Meanwhile, the ancient powers... Are trying to destroy America.
As long as America can stand strong, there will be no "One World Government"
(Communism for all... For FREE!)
Yep, it makes no sense. Until you see they are raising the cost of borrowing money.
Meanwhile, Biden converted ALL of the 30 yr bonds to 3,5, and 10 yr bonds. Forcing Trump to deal with re-issuing bonds at higher rates.
Trump was right. They want US GONE. He is just in there way.
Follow these ladies:
https://www.youtube.com/watch?v=okdcl...
At one point, the story goes, he found out that if he controlled the editors of the major newspapers (the big ones), he could control the narrative. So, he did.
I think it became the CFR. And their goal was to make sure they NEVER covered what they were doing.
I know this indirectly. We had the case of a Dr. who was injecting himself with HIV+ blood.
To make the point that this is not what is killing these people.
It was NOT ALLOWED to make the news or the front page of any newspaper.
Not too long, he had a "heart attack" and died. He mad the news in other countries.
Just not ours.
Modern Version: Who is showing you that STATINS can lead to dementia?
In fact, there is a study of Seniors who developed dementia. Take them off the statins for like 2 months, and like 80% are no longer diagnosed with dementia. Put them back on, and in 2 months or so, they register as having dementia.
BTW, WTF is a SENIOR taking a statin for? To prevent a heart-attack (supposedly caused by plaque build up that the statin prevents... Which is not even true, because they don't measure it, and statins tend to increase plaque over time... LOL)...
My aunt just had this happen to her, WE detected the issues, asked if they put her on a statin. At 86, they had doubled her dose. WTF? She is thin and healthy/active. But now suffering brain fog, forgetting things. I told her it is likely the statin, she might want to try the old dose (she has NEVER had a heart attack)... she did that. And within 2 weeks felt so much better, she stopped taking the statin completely. And she said "I thought I was just losing it because I was getting old!"
But NOBODY shall know anything that they don't want you to know. That doesn't PUSH you in the direction they need you to be pushed. It's all lies. Fauci ran the HIV=AIDS fraud. I believe it has NEVER been proven that HIV causes AIDS. They changed the definition of AIDS to "require HIV+ result". Kary Mullis (PCR inventor) pointed this out, and was quickly ex-communicated.