When the Federal Reserve stops supplying the banks with trillions of dollars, most experts fear an economical vacuum. What our government and the federal reserve have been doing since 2008 has never been done before in American history. They have pumped over 4 trillion dollars of printed money into the biggest banks’ pockets. Now that the economy seems to be recovering, they are now stuck with their pants down…so to speak. They could have lowered taxes, which would have helped businesses to grow and create better jobs, a stable stock market, and a stronger economy. They, however, chose to use a money-laundering scheme. This is the main reason why the stock market has continued to grow, and the rich have become incredibly richer. The after effects of this scam will most likely be higher taxes, lower property values, stock market crash, massive reduction of retirement funds, job losses and more. Unfortunately, most experts are saying this economical collapse could make the collapse of 2007 seem miniscule. I am guessing the administration sees this scenario unfolding before them, hence the reason why the drop in oil prices. This welcoming reduction in fuel/energy costs will create a natural stimulus to the economy. In the past, allowing taxpayers to keep more of their money will naturally stimulate the economy.
The government’s next problem is solving the spending budget nightmare. This country’s economy will never fully recover without a budget that includes long-term military and municipality spending. Hopefully, the President and the new Congress will agree on a long-term quality budget.
Here’s short video explaining Quantitative Easing –