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IPFS News Link • Economy - Economics USA

Gerald Celente: Halloween Stimulation Around the Globe?

• The Daily Bell

Federal Reserve Board chair Janet Yellen announced on Wednesday that the Fed's benchmark interest rate – the federal funds rate – will remain unchanged ... The statement by the Federal Open Market Committee, the central bank body responsible for adjusting interest rates, showed an increase in optimism, omitting a reference that was in September's announcement to fears about "global economic and financial developments." But the apparent improvement in the Fed's outlook came despite its acknowledgment that the "pace of job gains slowed and the unemployment rate held steady." – HuffPost Business

Dominant Social Theme: The Fed is done with quantitative easing.

Free-Market Analysis: The Federal Reserve again decided not to hike. But officials put out a statement that a rate hike was more likely at the end of the year. This is in line with a recent Daily Bell analysis that you can view here.

We concluded in this analysis that gold may be the best safe-haven play and were pleased to see a recent post by trend watcher Gerald Celente that makes some of the same points.

Celente provides a "big picture" presentation that shows definitively that the world is about to be flooded with yet more liquidity – as if US$200 trillion or so in the past half decade or so is not enough.

He writes:

Capitalism is dead. It has been replaced by Bankism, one of our Top Trends for 2015. The principles of free market economics, price discovery and fiscal discipline have been replaced ... When [current bubbles burst] and economic chaos prevails, gold, we forecast, will emerge as a safe haven asset.

Celente's analysis is certainly buttressed by the HuffPost Business article presented above. Conditions, we learn, are not ripe for a rate hike NOW but soon they may be. Here's more from the HuffPost article:

The FOMC will next meet on Dec. 15 and 16 to decide whether to raise rates. And in a less expected development, the Fed's Wednesday announcement clearly left the door open to an interest rate hike in December.

... No matter what decision comes in December, the news will not be great. Even if the bank maintains current interest rates -- a move that employment advocates might have welcomed a few months ago as a decision to err on the side of jobs and wage growth -- it would now be considered a sign that the economy is worse off than even those advocates had warned.

Here is why: If Fed officials -- who, partly by virtue of their role, are far less sensitive to concerns about inadequate job growth than many full employment advocates -- think the economy is too sluggish to raise rates, then the economy is really in trouble.


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