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IPFS News Link • Federal Reserve

"Sweep the Leg"

• Sovereign Man - Simon Black

It was barely a week ago that the federal government estimated it would borrow $3.7 trillion this fiscal year due to all the Covid bailouts.

Then, only a few days later, the Treasury Department updated the estimate and announced they would in fact be borrowing $4.5 trillion this fiscal year.

That's an increase of $800 billion in less than a week!

Not to be outdone, the Federal Reserve has printed more than $2.5 trillion in less than 50 days, expanding its own balance sheet by 62% since the start of the pandemic.

I've been really hammering this theme lately, but it's critical to understand: there is no limit to the amount of money they'll print, or to the amount of debt they'll take on.

And this has serious implications for the dollar.

It would be foolish to expect that you can create trillions of dollars in a matter of weeks, and take on trillions of dollars in debt, without any consequences whatsoever.

I've already written this a number of times, but I'll repeat it again: if printing money were the way to achieve prosperity, then Zimbabwe would already be the wealthiest country in the world.

Prosperity requires smart, talented, hardworking people efficiently producing valuable goods and services. You can't just click a button and create that out of thin air.

But politicians don't seem to understand this simple point.

It's far easier for them to print money, go into debt, and bail everyone out. And when that approach doesn't work, they resort to dismantling capitalism, brick-by-brick.