Budget/Spending/Taxing Announcement

Get Out Of Jail Card For The Fed

The announcement that the Federal government was going to spend another $7 trillion “funded” by increased taxes of $5 trillion was breathtaking.

It is so outrageous. The announcement that is. Not the reality. Years back, it was calculated that simply confiscating the wealth of the 1% would only fund the government for a month. The game is to make it seem like the government is going after the wealthy and corporations in the name of “fairness”.

The reality has always been that the population in general winds up paying the taxes. However, this plan is so over the top that every one should realize they have a tax bullseye painted on their back. “You will own nothing, and be happy”. It is also important to remember that only 50% of the people pay taxes.

So I thought about why this announcement and the timing. My conclusion is that it is a “Get Out Of Jail Card” for Powell and the Federal Reserve. Anyone with a four-function calculator can figure out that the Fed is trapped. Congress won’t stop spending, and the historic buyers of Treasury debt won’t do it unless interest rates are double or triple from current levels.

The Fed has been using very clever and inventive tricks to keep the scam going far longer than anyone foresaw. The jig is up.

So how do you buy a little more time? Tell everyone not to worry. We’ll get the spending power by raising taxes by $5 trillion. A complete joke that any serious student of finance, markets and history can conclude.

They are desperate. Desperate times call for desperate measures. This plan is dead on arrival.