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The Federal Reserve Is Paying Banks NOT To Lend 1.8 Trillion Dollars To The American People

The Federal Reserve Is Paying Banks NOT To Lend 1.8 Trillion Dollars To The American People

Did you know that U.S. banks have more than 1.8 trillion dollars parked at the Federal Reserve and that the Fed is actually paying them not to lend that money to us?  We were always told that the goal of quantitative easing was to “help the economy”, but the truth is that the vast majority of the money that the Fed has created through quantitative easing has not even gotten into the system.  Instead, most of it is sitting at the Fed slowly earning interest for the bankers.  Back in October 2008, just as the last financial crisis was starting, Federal Reserve Chairman Ben Bernanke announced that the Federal Reserve would start paying interest on the reserves that banks keep at the Fed.  This caused an absolute explosion in the size of these reserves.  Back in 2008, U.S. banks had less than 2 billion dollars of excess reserves parked at the Fed.  Today, they have more than 1.8 trillion.  In less than five years, the pile of excess reserves has gotten nearly 1,000 times larger.  This is utter insanity, and it will have very serious consequences down the road.

Posted below is a chart that shows the explosive growth of these excess reserves in recent years…

Excess Reserves

This explains why all of the crazy money printing that the Fed has been doing has not caused tremendous inflation yet.  Most of the money has not even gotten into the economy.  The Fed has been paying banks not to lend it out.

But now that big pile of money is sitting out there, and at some point, it is going to come pouring into the U.S. economy.  When that happens, we could very well see an absolutely massive tsunami of inflation.

Posted below is a chart that shows the growth of the M2 money supply over the past several decades.  It has been fairly steady, but imagine what would happen if you took the hockey stick from the chart above and suddenly added it to the top of this one…

M2 Money Supply

The longer that the Federal Reserve continues to engage in quantitative easing and continues to pay banks not to lend that money out to the rest of us, the larger that inflationary time bomb is going to become.

In a recent article for the Huffington Post, Professor Robert Auerbach of the University of Texas explained the nightmarish situation that we are facing…

One reason that the excess reserves grew to an extraordinary level is that in October 2008, one month after the financial crisis when Lehman Brothers went bankrupt, the Bernanke Fed began paying interest on bank reserves. Although it has been 1/4 of 1 percent interest, this risk free rate was not low compared to the Fed’s policy of keeping short-term market rates near zero. The interest banks received was and is an incentive to hold the excess reserves rather than lend to consumers and businesses in the risky environment of the major recession and the slow recovery.

The Bernanke Fed is now facing a $1.863 trillion time bomb, they helped to create, of excess reserves in the private banking system. If rates of interest on income earning assets (including bank loans to consumers and businesses) rise, the Fed will have to pay the banks more interest to hold their excess reserves.

If interest rates move up dramatically (and they are already starting to rise significantly), banks will have an incentive to take that money out of the Fed and start lending it out.  Professor Auerbach suggests that this could cause an “avalanche” of money pouring into the economy…

Eighty five billion a month will seem tiny compared to the avalanche of the $1.863 trillion excess reserves exploding rapidly into the economy. That would devalue the currency, cause more rapid inflation and worry investors about a coming collapse.

So the Fed has kind of painted itself into a corner.  If the Fed keeps printing money, they continue to grossly distort our financial system even more and the excess reserves time bomb just keeps getting bigger and bigger. This is why we believe Gold is a great investment.

But even the suggestion that the Fed would begin to start “tapering” quantitative easing caused the financial markets to throw an epic temper tantrum in recent weeks.  Interest rates immediately began to skyrocket and Fed officials did their best to try to settle everyone down.

So where do we go from here?

Unfortunately, as Jim Rogers recently explained, this massive experiment in financial manipulation is ultimately going to end in disaster…

I’m afraid that in the end, we’re all going to suffer perhaps, worse than we ever have, with inflation, currency turmoil, and higher interest rates.

The Fed and other global central banks have created the largest bond bubble in the history of the planet.  If the Fed ends quantitative easing, the bond market is going to try to revert to normal.

That would be disastrous for the global financial system.  The following is what Jim Willie told Greg Hunter of USAWatchdog.com…

Everything is dependent on Fed support. They know if they take it away, they’re going to create a black hole. The Treasury bond is the greatest asset bubble in history. It’s at least twice as large as the housing and mortgage bubble, maybe three or four times as large.

But even if the central banks keep printing money, they may not be able to maintain control over the bond market.  In fact, there are already signs that they are starting to lose control.  The following is what billionaire Eric Sprott told King World News the other day…

It’s total orchestration. And it’s orchestration because they might have lost control of the bond market. I find it such a juxtaposition that central banks on a daily basis buy more bonds today than they ever purchased, and interest rates are going up, which is almost perverted. I mean how can that happen?

They’ve lost control of the market in my mind, and that’s why they are so desperately trying to get us all to forget the word ‘taper.’ In fact, we probably won’t even hear the word ‘taper’ anymore because it has such a sickening reaction to people in the bond market, and perhaps even people in the stock market. They will probably do away with the word. But the system is totally out of control. And then we’ve got this quadrillion dollars of derivatives. It just blows blows my mind to think about what could really be going on behind the scenes.

Sprott made a really good point about derivatives.

The quadrillion dollar derivatives bubble could bring down the global financial system at any time.

And remember, interest rate derivatives make up the biggest chunk of that.  Today, there are 441 trillion dollars of interest rate derivatives sitting out there.  If interest rates begin skyrocketing at some point, that is going to create some absolutely massive losses in the system.  We could potentially be talking about an event that would make the failure of Lehman Brothers look like a Sunday picnic.

We are moving into a time of great financial instability.  People are going to be absolutely shocked by what happens.

Our financial system is a house of cards built on a foundation of risk, leverage, and debt.  When it all comes tumbling down, it should not be a surprise to any of us.

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ZZZOF Zinc One Resources, Inc.

ZZZOF Zinc One Resources, Inc. $ZZZOF #ZZZOF

Welcome to our page on Zinc One Resources, Inc..

We have designed this page to give an idea of what are some good questions to ask before investing in ZZZOF.

When we search OTCmakets it has ZZZOF’s industry listed as Metal Mining

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as info@zincone.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZZZOF is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Zinc One Resources, Inc. is Pink Current

ZZZOF is incorporated in British Columbia, Canada in the year 2007.

The CEO of the company is James Walchuck

According to OTCmarkets the Authorized shares for the company are Unlimited and the Outstanding shares are .

The transfer agent(s) are Not Available

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ZZLL ZZLL Information Technology, Inc.

ZZLL ZZLL Information Technology, Inc. $ZZLL #ZZLL

Welcome to our page on ZZLL Information Technology, Inc..

We have designed this page to give an idea of what are some good questions to ask before investing in ZZLL.

When we search OTCmakets it has ZZLL’s industry listed as Retail-Miscellaneous Retail

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as info@zzlliti.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZZLL is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of ZZLL Information Technology, Inc. is OTCQB

ZZLL is incorporated in Shell in the year NV, USA.

The CEO of the company is Sean L. Webster

According to OTCmarkets the Authorized shares for the company are 400,000,000 and the Outstanding shares are .

The transfer agent(s) are Madison Stock Transfer Inc.

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ZYXI Zynex, Inc.

ZYXI Zynex, Inc. $ZYXI #ZYXI

Welcome to our page on Zynex, Inc..

We have designed this page to give an idea of what are some good questions to ask before investing in ZYXI.

When we search OTCmakets it has ZYXI’s industry listed as Electromedical equipment

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as info@zynex.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZYXI is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Zynex, Inc. is OTCQB

ZYXI is incorporated in NV, USA in the year 1996.

The CEO of the company is Thomas Sandgaard

According to OTCmarkets the Authorized shares for the company are 100,000,000 and the Outstanding shares are .

The transfer agent(s) are Colonial Stock Transfer Co., Inc.

If you have more information on the ZYXI Zynex, Inc. or want to share your thoughts, please feel free to comment.

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ZYTO Zyto Corp.

ZYTO Zyto Corp. $ZYTO #ZYTO

Welcome to our page on Zyto Corp..

We have designed this page to give an idea of what are some good questions to ask before investing in ZYTO.

When we search OTCmakets it has ZYTO’s industry listed as Electronic & Other Electrical Equipment (No Computer Equip)

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as info@ZYTO.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZYTO is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Zyto Corp. is Pink No Information

ZYTO is incorporated in DE, USA in the year 1998.

The CEO of the company is Kami Howard

According to OTCmarkets the Authorized shares for the company are 80,000,000 and the Outstanding shares are .

The transfer agent(s) are Pacific Stock Transfer Co.

If you have more information on the ZYTO Zyto Corp. or want to share your thoughts, please feel free to comment.

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ZYRX Zyrox Mining International, Inc.

ZYRX Zyrox Mining International, Inc. $ZYRX #ZYRX

Welcome to our page on Zyrox Mining International, Inc..

We have designed this page to give an idea of what are some good questions to ask before investing in ZYRX.

When we search OTCmakets it has ZYRX’s industry listed as Plastics materials and resins

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as rogallom@aol.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZYRX is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Zyrox Mining International, Inc. is Pink No Information

ZYRX is incorporated in NV, USA in the year 2009.

The CEO of the company is Carl Kruse Cruz

According to OTCmarkets the Authorized shares for the company are 3,300,000,000 and the Outstanding shares are .

The transfer agent(s) are OTR, Inc.

If you have more information on the ZYRX Zyrox Mining International, Inc. or want to share your thoughts, please feel free to comment.

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ZWRR Ziwira Inc.

ZWRR Ziwira Inc. $ZWRR #ZWRR

Welcome to our page on Ziwira Inc..

We have designed this page to give an idea of what are some good questions to ask before investing in ZWRR.

When we search OTCmakets it has ZWRR’s industry listed as Computer integrated systems design

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as Not Available

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZWRR is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Ziwira Inc. is Pink No Information

ZWRR is incorporated in DE, USA in the year 2015.

The CEO of the company is Firas Khaleel Al Haddad

According to OTCmarkets the Authorized shares for the company are 250,000,000 and the Outstanding shares are .

The transfer agent(s) are Not Available

If you have more information on the ZWRR Ziwira Inc. or want to share your thoughts, please feel free to comment.

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ZWBC GoldKey Corporation

ZWBC GoldKey Corporation $ZWBC #ZWBC

Welcome to our page on GoldKey Corporation.

We have designed this page to give an idea of what are some good questions to ask before investing in ZWBC.

When we search OTCmakets it has ZWBC’s industry listed as Not Available

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as Not Available

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZWBC is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of GoldKey Corporation is Pink No Information

ZWBC is incorporated in NV, USA in the year Not Available.

The CEO of the company is Not Available

According to OTCmarkets the Authorized shares for the company are 20,000,000 and the Outstanding shares are .

The transfer agent(s) are Not Available

If you have more information on the ZWBC GoldKey Corporation or want to share your thoughts, please feel free to comment.

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ZVTK Zevotek, Inc.

ZVTK Zevotek, Inc. $ZVTK #ZVTK

Welcome to our page on Zevotek, Inc..

We have designed this page to give an idea of what are some good questions to ask before investing in ZVTK.

When we search OTCmakets it has ZVTK’s industry listed as Retail-Food Stores

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as info@zevo-tek.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZVTK is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Zevotek, Inc. is Pink No Information

ZVTK is incorporated in DE, USA in the year Not Available.

The CEO of the company is Jason Ryu

According to OTCmarkets the Authorized shares for the company are Not Available and the Outstanding shares are .

The transfer agent(s) are OTR, Inc.

If you have more information on the ZVTK Zevotek, Inc. or want to share your thoughts, please feel free to comment.

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ZURVY Zurich Insurance Group Ltd.

ZURVY Zurich Insurance Group Ltd. $ZURVY #ZURVY

Welcome to our page on Zurich Insurance Group Ltd..

We have designed this page to give an idea of what are some good questions to ask before investing in ZURVY.

When we search OTCmakets it has ZURVY’s industry listed as Finance Services

One other important thing to look at is how easy is it to get ahold of the company.
We are finding that they have their phone number listed as . It looks like their email is listed as investor.relations@zurich.com

When we are looking through a company’s financials, one of the first things we look for is whether their financials are audited or not. Currently ZURVY is listed as .

Listing status is something else that is very important to look at! It looks like as of the time this page was created the listing status of Zurich Insurance Group Ltd. is OTCQX International Premier

ZURVY is incorporated in Switzerland in the year 1872.

The CEO of the company is Mario Greco

According to OTCmarkets the Authorized shares for the company are Not Available and the Outstanding shares are .

The transfer agent(s) are BNY Mellon

If you have more information on the ZURVY Zurich Insurance Group Ltd. or want to share your thoughts, please feel free to comment.

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