xsuddensam

Will the Fed Actually Raise Rates Next Week?

Murphy 834:

Oh, I don't think I'm being extreme at all. The truth is that our economic growth model is based on unregulated credit rather than on good fundemental economic princples. To support this artificial growth, increased printing of fiat currency is essential.

The current sub-prime mortgage disaster is a direct manifestation of too much liquidity provided by the Fed. When there's too much money available, lenders are falling all over themselves trying to make loans; hence, with rising home prices, they are willing to make ARMs to unqualified borrowers based on the unreasonable expectation that home prices would continue to rise and these ridiculous loans would later be refinanced under more favorable terms and conditions. This current event can be likened to a variation of a Ponzi scheme.

Cental bank interventions, short term fall in oil prices and bear market sucker's rallies may support the dollar in the short term, but I see no long term improvement until the Fed sucks it up and stops this reckless printing of money.