Wednesday 10 February 2016

Why is FED raising rates?

USA has been printing lots of dollars, under the guise of QE (Quantitative Easing). Many countries are dumping dollars and conducting trade outside the US$, to protect themselves from US$ tsunami. All the dollars being created are not being absorbed outside USA. Billions of dollars created, will now remain in USA. Inflation in USA will rise fast. Unrest will increase in USA if prices start rising rapidly.

FED has to slow down inflation in USA to extend the life of dollar. The only way inflation can be reduced to something manageable is to raise interest rates. So as countries keep abandoning the dollar, FED will keep raising interest rates in USA. If countries abandon dollar fast, interest rates will rise fast; if countries abandon dollar slowly, interest rates will rise slowly.

The rising interest rates will force USA into depression. Stocks and Real estate will fall. Ultimately, FED will have no choice but to abandon the interest rate rises. The dollar, as we know currently, will collapse. Banks will go bankrupt. Only Gold and Silver in your hands will protect your wealth.


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