Have you looked at your investment choices today? Have you checked the rates of return available on your savings? For example how do these rates strike you: passbook savings account, 0.17%; 1-yr treasury notes, 0.22%; a 2-yr CD, 0.34% or 10-year bonds, 2.6%? Are you laughing yet? You can’t even get a 1/3rd of a percentage point of interest on a 2-yr CD! What’s that doing for your children’s college education fund or your retirement plans? What the Fed and the Government don’t want you to remember is: This is a direct and deliberate result of their policies – you are being sacrificed for the State, the banking industry, failed industries and unions.
How are people adjusting? In order to keep up with inflation, people are forced to put their money in riskier and riskier investments. In order to make a reasonable return above inflation and taxes people have no choice but to seek the riskiest investments such as stocks and junk bonds. This should not be the case and often leads to disaster for even experienced investors as the markets are buffeted by Government created bubbles and market distortions.
What’s worse: it’s not going to get any better. The recently announced Quantitative Easing 2 (QE2), the plan by the Federal Reserve and Government to stimulate the economy by purchasing $600 billion of US Treasury debt is more than another Keynesian debt package which destroys the value of the dollar and adds to monetary inflation. It is a direct attack on the ability of the American people to save and invest for the future. It is the Keynesian dream of destroying savings and return on investments and replacing it with a Government system of interest-free loans. A system designed to force people to spend rather than save. A system designed to punish anyone who tries to save for the future. A system designed to make everyone a vassal, dependent upon the State for their future well-being.
The entire premise of the Fed’s QE2, which is really intervention in how you make decisions about spending, savings and investment, is to drive interest rates down below their market value. They don’t care that the free-market would give you 5% interest for loaning money for say five years. They hate the idea that those who save should receive anything for loaning money. They hate the idea that people and businesses that need money should have to compete in the market for a limited pool of savings and investment. The Keynesian theory states this is a limiting factor on investment and employment. Those who save deserve nothing – in fact they should probably be punished by the State.
That is where we are today; the State through the Federal Reserve is determined to punish those who save. They never mention that your money, your savings, your investments were created through hard work and sacrificing today’s desires for a better tomorrow. You are being robbed by a Government which rewards itself by destroying your earnings. It is not only immoral; it is destroying the economic system of the country – a system which took three hundred years to build.