-----Original Message-----
From: Stansberry Research <customerserv...@stansberryresearch.com>
To: COL. WILLIAM D. LEED III <wle...@aol.com>
Sent: Sat, Jun 20, 2015 9:16 am
Subject: Masters Series: Ron Paul – The U.S. Economy Is 'Fundamentally Unsound'
June 20, 2015
Editor's note: By now, many of you know that former congressman Dr. Ron Paul
has agreed to endorse Stansberry Research. Dr. Paul spent his 22-year
Congressional career fighting to fix our country's finances and protect the
liberty of all U.S. citizens.
Today's Masters Series essay appeared in December on the Ron Paul Institute
for Peace and Prosperity's website. In it, Dr. Paul explains why we're simply
papering over our severe economic problems… and we're on a crash course for
disaster…
The U.S. Economy Is 'Fundamentally Unsound'
By Dr. Ron Paul
Last week, we learned that the key to a strong economy is not increased
production, lower unemployment, or a sound monetary unit. Rather, economic
prosperity depends on the type of language used by the central bank in its
monetary policy statements.
All it took was one word in the Federal Reserve Bank's press release – that
the Fed would be "patient" in raising interest rates to normal levels – and
stock markets went wild. The S&P 500 and the Dow Jones Industrial Average had
their best gains in years, with the Dow gaining nearly 800 points from
Wednesday to Friday and the S&P gaining almost 100 points to close within a few
points of its all-time high.
Just think of how many trillions of dollars of financial activity occurred
solely because of that one new phrase in the Fed's statement. That so much in
our economy hangs on one word uttered by one institution demonstrates not only
that far too much power is given to the Federal Reserve, but also how
unbalanced the American economy really is.
While the real economy continues to sputter, financial markets reach record
highs, thanks in no small part to the Fed's easy-money policies. After six
years of zero interest rates, Wall Street has become addicted to easy money.
Even the slightest mention of tightening monetary policy and Wall Street reacts
like a heroin addict forced to sober up cold turkey.
While much of the media paid attention to how long interest rates would remain
at zero, what they largely ignored is that the Fed is, "maintaining its
existing policy of reinvesting principal payments from its holdings of agency
debt and agency mortgage-backed securities in agency mortgage-backed
securities." Look at the Fed's balance sheet and you'll see that it has
purchased $25 billion in mortgage-backed securities since the end of QE3.
Annualized, that is $200 billion a year. That may not be as large as QE2 or
QE3, but quantitative easing, or as the Fed likes to say, "accommodative
monetary policy," is far from over.
What gets lost in all the reporting about stock market numbers,
unemployment-rate figures, and other economic data is the understanding that
real wealth results from production of real goods, not from the creation of
money out of thin air. The Fed can rig the numbers for a while by turning the
monetary spigot on full blast, but the reality is that this is only papering
over severe economic problems. Six years after the crisis of 2008, the economy
still has not fully recovered, and in many respects is not much better than it
was at the turn of the century.
An economy that holds its breath every six weeks, looking to parse every
single word coming out of Fed Chairman Janet Yellen's mouth for indications of
whether to buy or sell, is an economy that is fundamentally unsound. The Fed
needs to stop creating trillions of dollars out of thin air, let Wall Street
take its medicine, and allow the corrections that should have taken place in
2001 and 2008 to liquidate the bad debts and malinvestments that permeate the
economy. Only then will we see a real economic recovery.
Regards,
Ron Paul
Editor's note: The U.S. government continues to make irresponsible decisions
with the economy. Dr. Paul and Stansberry Research founder Porter Stansberry
agree: This negligence will lead the U.S. into a currency crisis.
That's why Dr. Paul wrote the foreword to Porter's newest book, America 2020 –
The Survival Blueprint. In it, Porter shares direct, specific, actionable
advice… like how to get real, hold-in-your-hand silver for less than $3 (page
57)… the world's three safest currencies, which you can buy without ever
leaving home (page 109)… and the best way to generate reliable income in
America over the next decade (page 255).
To learn more about America 2020 and watch a video of a conversation Porter
recently had with Dr. Paul, click here.
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[FairfieldLife] Fwd: Masters Series: Ron Paul – The U.S. Economy Is 'Fundamentally Unsound'
William Leed wle...@aol.com [FairfieldLife] Sat, 20 Jun 2015 06:27:35 -0700
