ZIRP: The Most Destructive Weapon Of Financial Mass Destruction In Existence
Zero Interest Rate Policy:
A Catastrophic U.S. Monetary Policy
Maintained By The FED
Although the true reasons behind ZIRP are rarely explained, their calamitous effects are nevertheless felt around the nation. There is perhaps no other monetary policy that has been so profoundly destructive to U.S. economy. ZIRP is as ill-conceived as it is doomed to failure.
Quite unfortunately for the depositors and investors of the nation, it is now too late to reverse the pervasive damage this covert scheme has wrought on both macrocosmic and microcosmic levels. ZIRP has been in place for so many years now that generations have been financially ruined just as the middle class has been effectively decimated.
What’s really going on here?
Whenever a nation’s monetary policy is designed to prop up banks that are Too Big To Fail (TBTF), the citizenry will be financially destroyed. The Federal Reserve — an international crime syndicate which is neither federal nor has hard assets in reserve — has implemented such a cataclysmic policy since 2008. It is known as Zero Interest Rate Policy (ZIRP).
The FED used the Great Recession of 2008 as an excuse to implement the current Zero Interest Rate Policy. Not only has it not served its stated purpose, it has wiped out trillions in savings and investments.
You see, when the interest rate is effectively maintained at 0% it serves as a great disincentive to keep a savings account. Once upon a time all the conservative folks in America kept their money if safe and sound savings accounts or CDs, as well as in money market accounts.
Now that the prevailing interest rates have been nearly zero for so many years, those same folks have felt compelled to move their money into investment vehicles which DO NOT MATCH their risk profiles. Herein lies the crux of the matter.
Nobody ever wants to see the buying power of their life savings be eroded due to inflation. When those funds sit in a 0% interest rate-bearing account, they lose buying power by the day. Given the relentless price inflation, especially for food and medicine, the pensioners have really suffered. Rents and mortgages, taxes and insurance only seem to go up as well, as do certain energy costs.
The upshot of this ever-worsening predicament is that it has become increasingly easy for the stock broker or investment counselor, financial consultant or estate planner to convince the inexperienced investor to move their life savings into much more speculative investments. This quite purposeful marketplace dynamic has been occurring with greater frequency both prior to and especially since 2008.
Those who are uninitiated into the true ways of the markets have been systematically duped into shifting their funds from safe havens over to quite risky capital appreciation funds and the like. Many of those highly speculative equity funds will undoubtedly crash and burn in the not too distant future leaving millions penniless. Pensioners are particularly vulnerable because of their fixed incomes, which are not rising to keep abreast with inflation and other new costs of living.
READ more about Setting a very bad example at http://stateofthenation2012.com/?p=35273
Doreen Ann Agostino
all rights reserved