Jim’s Mailbox

Posted at 8:07 AM (CST) by & filed under Jim's Mailbox.

Jim/Bill,

The Fed may be the problem, but it’s not the resolution.

The Fed raising interest rates to fight our inflationary problem seems inappropriate at this time. It’s targeting the wrong area.

Higher interest rates will not prevent oil (a major component of inflation) from reaching $100+ bbl.

Higher interest rates will not address supply chain disruptions, which pushes prices from food to lumber ever higher.

Higher interest rates will not affect steadily rising Healthcare costs. In fact, now insurers are imposing additional fees to individuals not getting all the vaccines and boosters.

I’ll tell you what higher interest rates affect:
-people’s IRA’s, 401k’s, equity and bond investments being decimated.
-bringing an already shaky economy to its knees with less demand from consumers, corporate entities reluctant to make capital expenditures, and a stronger Dollar making exports decline.
-also, higher interest rates will make funding the Treasury’s exceedingly difficult.

This (inflation) is a Fed induced problem, however the resolution lies with the government. Addressing port congestion, cross border covid related trucking travails governing produce and lumber, overly restrictive covid regulations, curtailing the green movement somewhat amongst our oil explorers, stop politicizing foreign nat gas pipelines (Gazprom) that are decimating the European economy, stop warmongering efforts with Russia, etc.

Everything is connected like a spiderweb, but it’s outside the purview of the Fed.

The consumer is in for one helluva ride to destitution. Get precious metals now while you can.

CIGA Wolfgang Rech

Correct on all points Wolfgang, but don’t forget the US Treasury and the $6 trillion++ in deficits over the last 2 years.

Bill

Pastor Stanley on the proposed digital dollar.

Bill

An Open Letter To The Board Of Governors Of The Federal Reserve System Regarding The Proposed Digital Currency
January 20, 2022
By Stan Szymanski
The Federal Reserve is ‘considering’ issuing a CBDC (Central Bank Digital Currency). They are asking for your ‘opinion’ by answering 22 different questions (they can be found at https://www.federalreserve.gov/apps/forms/CBDC) and the Fed’s prevention for the consideration of a digital dollar can be found here (which you might read (if you have the time)) to have an understanding of the questions: https://www.federalreserve.gov/publications/money-and-payments-discussion-paper.htm and click on the link to the accompanying 40 page PDF if you are so inclined). In today’s writing, I am going to offer some thoughts maybe not only for the Federal Reserve but for Louie and LouAnn LunchBox to consider (nothing contained in this writing is financial advice-consult your financial advisor). There is no way I can cover all facets of this issue in one article; hopefully this is a jumping off point for you to form your own opinion.

  1. What additional potential benefits, policy considerations, or risks of a CBDC may exist that have not been raised in this paper?

Is a new CBDC going to do things better than Bitcoin or Litecoin? The people who write the code for Bitcoin have been at it for years and it has already been alpha/beta tested through over 12 years of transactions. Plus the ‘Network effect’ (as described by Trace Mayer) of Bitcoin is almost unsurpassable at this point. If the USCBDC comes out and is besieged by payment problems it will just make people run to Gold, Silver or Bitcoin that much faster.

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