The Federal Reserve is About To Pull The Plug: Prepare For ‘Quantitative Tightening’ & ‘Creative Destruction’

What will happen as the US Federal Reserve decides to pull away the “unconventional” monetary stimulus punch bowl from the US and global economies?  Will their actions truly be for the good of both US and foreign economic and political stability, or is it all part of a much wider, longer term design aimed at nurturing collective chaos en route to a grander planned sense of international ‘synthesis’?  In this latest episode of Money and Fear, we’ll look at both “Quantitative Easing” (QE) as well as its impending policy nemesis, “Quantitative Tightening” (QT), or the Fed’s shrinking of its balance sheet, coupled potentially with hiking interest rates, as ad hoc and imminently unruly processes.  The Fed’s – and foreign central banks’ - latest measures are about to wreak havoc in markets, not unlike what happened nearly a decade ago, which triggered said QE implementation in the first place.  Sober questioning coupled with quantitative data and a sampling of input from leading commentators will be offered for your sense of defense, so tune in.

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Show Notes

Today the music stops

Federal Reserve Will Continue Cutting Economic Life Support

Back To Rehab Or Continue Chasing The Dragon

Gold Investment “Compelling” As Fed May “Kill The Business Cycle”

The Fed Balance Sheet and its $4.5trn Conundrum

The Fed's new frontier: What happens, why it matters and what could go wrong

The consequences of shrinking the Fed’s balance sheet

Wall Street Icon Warns The Fed's Balance Sheet Unwind "Is Very Dangerous For Markets”

The Fed's Balance Sheet Reduction Could Be A Lot More Dangerous Than People Think

Fed plan to reverse QE is fraught with danger

Want To Know What The S&P500 Does Next? Just Look At The Fed's Balance Sheet

The Most Dangerous Balance Sheet in the World

The Fed Is About to Unleash a Monster: Market Recon

The Fed is about to start unwinding its unprecedentedly large balance sheet — and no one knows what will happen

Bank stocks are rising after the Fed announces it will unwind its balance sheet (BAC, GS, C, JPM, KEY, WFC, BBT)

The Fed Is Ready To Begin Chipping Away At $4.5 Trillion Balance Sheet

Deutsche Bank: "This Is The $2.5 Trillion Question"

Fed's Asset Bubbles Now At The Mercy Of The Rest Of The World's Central Bankers.

QT1 Will Lead to QE4

*For additional footnotes and links refer to the Newsbud article link above

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  1. Jon L Curran says:

    Will there be a war to mask this?

  2. Robert Diggins says:

    What are the other global monetary platforms, which have been in the works for years?

    Also, do you think that various types of investors will try to hedge their stores of value in precious metals, commodities, and/or possibly crypto currency (public/open source or proprietary)?

    Lastly, do you see any chatter about so-called “opt-in” scenarios in the USA, including from public sector retirement accounts/ pensions or about any threats to Social Security?

    Thanks in advance.

    • My prior episode on Bitcoin/cryptocurrencies gets into said other global monetary platforms, including IMF SDRs, presumably linked with regulated cryptos / e-money. My future episode will deal with the gradual doing away of physical cash as part & parcel…

      Investors are already heading using precious metals, et al, and the wealthier, the more actively.

      Yes to the rest, as opt-ins, bail-ins, potential asset seizures, etc. are all on the table, with ‘experiments’ with them having been conducted in Europe & Asia over the past few years.

  3. Judith Williams says:

    I have been hearing about this for soooo long now. Do you believe this will happen suddenly or over a period of months/years? Do you think Social Security will disappear? The elderly will be out on the street? I have been preparing but there is only so much someone of my age can do. I think a shit storm is coming. They have been taking down America for a long time now beginning with taking the jobs overseas, now with the police state, agenda 21, geoengineering, HAARP–what was said here is right. They do not care about the people and I think we can expect the same treatment as Greece or now Puerto Rico and it looks like Spain is also beginning to come unraveled. This is scarry stuff folks and Americans are going to be in total shock.

  4. And by The Fed’ or The Bank of England et al, we mean The Casino Overlords. And by Wall Street/The CIty/La Bourse et al we mean Casino Security who shake you down for your winnings while they toss you out the trade entrance.

    Not sure what these, already fearful of the masses, apex dwellers get out of turning America into a chaos zone. Unless the delusional stupidity of it just goes with the territory of being driven mad by greed and/or power.

    The good news is we don’t need money. Money doesn’t grow food or keep the water pumping, people do.

    Police state + cashless society = breaking point.

    I just hope next time we start over, we try life without money. It’s never worked for the good in 6000 years. The US economy isn’t slowing so much as sliding into a deep abyss. It’s a fraud, what other outcome can we expect? I will put Russian and Chinese smarts ahead of the US any day in avoiding money chaos. It is the western middle class that is most vulnerable to economic collapse, softened up by our dependency on paid employment and pension funds pimped out to hedge fund managers and banksters.

    This is an opportunity to wipe the slate clean, grow up and admit money is stupid and collectively decide to put compassion first last and always and personal wealth last. If we’re all healthy and at peace with our neighbours, then the sky’s the limit for everyone.

  5. victor friese says:

    How are governments going to deal with this? I mean, are they just going to kill most of us in nuclear war? I know you said we would likely have war, but what will it look like? What will the methods for handling this look like? Will SSI, drawn from the tax fund, not social security, be done away with? Will the trillions stolen from social security, and the trillions stolen by the military, and the trillions in the offshore oligarch banks come into play? So prices will drop leaving companies unable to pay debt… to be bought up by banks? And our debts will be even more valuable? What will happen to my generation with unbankruptable debt?

    It looks like a clusterfuck with nothing good happening for a long time. It is disturbing. Lower prices, the same debt, fewer jobs… am I wrong in getting the impression that we are headed for economic hell? I was hoping there would be a bright side.

    • The Transatlantic Establishment Elite inevitably want a level of overall global population reduction that would see hundreds of millions dead, the timing of which is indeterminable.

  6. Max Havelaar says:

    A gold-backed RMD (Yuan)! Why would Buffet&friends not invest in these? He cares for ROI only.

  7. Just out from the London FT, which is the paper of record, and repeating what I said above:

    • Max Havelaar says:

      Is a peacefull take-over of the gold-backed Yuan in this MAD (automated mutual and planetary destruction) nucleair era not wat more likely?

      In my view, American dollar and military supremacy is waning and already they cannot dominate the world any more as sole superpower.

  8. victor friese says:

    But why would they want the reduction. It is not needed for food, there is plenty, or war sarting issues, the elite start the wars, nor environmental issues, which do not matter to the elite as can be seen in places like Mosul.

    There must be something more to it than just reducing population. Do they want us all bombed back to the stone age middle east style, so we will be compliant? That would suit any interest in complete dominance.

    • I guess if you’re willing to shove subsistence farmers off their land because machines are more ‘effecient’ (efficient for whom you may ask), then that logic extends to culling all those that ‘will be replaced’ by machines in the future.

  9. Thanks Mr Ian.
    I agree with other comments that war – WWIII – will be part of this financial re-organization. The NWO in its global totality.
    WWI & WWII were fought for the same reason.
    And they’ve been hard at work on multiple fronts to engineer WWIII into reality.
    Playing East off against West, the ultimate Divide & Conquer. Economically, financially & militarily.

    This is why they don’t care how high the debt actually goes, 20 trillion? Whatever. 30 trillion? No problem.
    Why even bother having a debt ceiling at all, eh?
    If you had told someone 30 years ago that the US debt would be 20 trillion in 2017, they would have said that you’re crazy, that it would be impossible.
    And yet, here we are. the entire planet in debt by tens of trillions of fiat dollars, pounds, yens, euros, yuans, etc. (and not even counting the derivatives and all other “financial instruments”) and the road to destruction (The Race to the Bottom) continues unabated.
    And with few exceptions, nobody cares.
    This can only mean that a major event is going to take place that is going to reset the whole system.
    And it’s not going to be pretty.
    Out of Chaos, Order.
    Problem, Reaction, Solution.
    The End Game of the current Dark Age Elite.

    If you don’t want to be part of it, then unplug yourself from this Matrix. This artificial hologram that has been – and continues to be – created for us.
    Ultimately designed for one thing, and one thing only: Full Spectrum Control over everything in, on and above this planet.
    Just looking at some of the pictures Pye had in this presentation shows how utterly sick and removed-from-(human)reality the whole system is.
    Back to basics, back to nature, back to Spirit, where we belong.
    Just as the ancients, the sages, the gurus and swamis have told us.
    It’s up to YOU.

  10. John Phillips says:

    I’ve been watching for 15 years now to see if the dollar would collapse. It has not and is unlikely to unless the powers that be want it to. So the question is, do they want it to implode the dollar now?

    My position; those who have the most aircraft carrier groups and weapons of mass destruction, namely nukes, wins.

    If the US does not want its hegemony to end…they will nuke the bloody bastards that try. End of story and this time it may really be the end of business as we know it with #45 at the helm. International business is positions themselves for both eventualities, hedging both sides.

    Keep your head down and your powder dry…this is getting very interesting…..
    Best Regards

  11. David Creighton says:

    Dump .. The .. Fed

  12. Joseph Harrington says:

    I had a very bad experience with subprime the other day. I went choice when I should of went prime. And the gist is: it was clearly a inferior meal

  13. Andreas Hedqvist says:

    The goal of the Fed is to induce inflation of course and they are using the only tools they know – money supply and interest rates. It’s understandable and IMO worth trying because unlike the consensus understanding of how QT will work I don’t think it will actually do much at all. The Fed can and most probably will simply allow their own holdings to expire and vanish off the books, this will in effect not affect the markets at all. The idea that the money supply will steer inflation through this action is totally wrong. Let’s be honest, the current money supply is bifurcated and the Main street economy has been neglected for a long time. If true inflation is the goal then looking at velocity is the only sure way to deal with this and that can be done by starting new programs to infuse liquidity where it is needed – states and municipalities. Why don’t we see this? Because the Fed’s intention is clear – they have no real wish to actually help the real economy and relinquish total control. They see the writing on the wall – the United States’ era of financial dominance is coming to an end and with it it’s global military supremacy. So while they still control things it is safer to schedule a controlled demolition and be able to steer the outcome than wait for someone else to step in and take over. This was bound to happen, a global financial debt jubilee of sorts, but whether or not a war is triggered as smoke screen is the bigger question and danger. The United States has been abused and broken by greed and corruption for such a long time that this may actually be a welcome development by the rest of the world. May you live in interesting times indeed.

  14. Joseph Reichart says:

    War is coming. Not just because of the circumstances with North Korea and Iran but I understand the integral link between the C.I.A. and Hollywood and media. Notice all of the new tv shows like Seal Team 6 and Nat Geo is coming out with a similar one. Hollywood is pushing a new patriotic military movie, all at the same time. This is indicative and prelude to war for it serves as a recruitment engine as well as inspiring nationalist sentiment. When the ball drops many people will join the military just because it’ll be more stable than the private sector. Financial collapse will also allow even more consolidation of power at the top. This is the check mate move for the New World Order!!!

  15. Soros’s comments below during an FT interview seem particularly relevant to Mr. Ian’s analysis.

    Also, my previous post is still under moderation. Intentional?

  16. The ‘factcheckers’ below put the relevance of the labor force participation rate in doubt by stating that during the whole period of 1948-1978 there was a lower rate than today, even if we don’t think of that period as particularly disastrous. Well, for the U.S. economy at any rate.

    If they are correct, then one would have to have more information than just the rate alone in order to make a judgment. As in: If one family member makes enough money for the rest of the family to concentrate on gardening, then there would be a low participation rate with lots of happiness I presume.

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