Paul Craig Roberts: Financial Collapse At Hand: When is "Sooner or Later"?.
Financial Collapse At Hand: When is "Sooner or Later"?
By Dr. Paul Craig Roberts |
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Global Research, June 5, 2012 |
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URL of this article: www.globalresearch.ca/index.php?context=va&aid=31272 |
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Ever
since the beginning of the financial crisis and Quantitative Easing,
the question has been before us: How can the Federal Reserve maintain
zero interest rates for banks and negative real interest rates for
savers and bond holders when the US government is adding $1.5 trillion
to the national debt every year via its budget deficits? Not long ago
the Fed announced that it was going to continue this policy for another 2
or 3 years. Indeed, the Fed is locked into the policy. Without the
artificially low interest rates, the debt service on the national debt
would be so large that it would raise questions about the US Treasury’s
credit rating and the viability of the dollar, and the trillions of
dollars in Interest Rate Swaps and other derivatives would come
unglued. | |
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