This is an excerpt from the Macroliquidity Pro Trader report. Macroliquidity Pro Trader weekly subscribers (or Professional Edition), click here to download complete report in pdf format.
US bank deposits and loans continue to grow rapidly. The same cannot be said for Europe, where we now have the monthly banking system data for December (Fed reports US data weekly). As you know if you are even minimally familiar with the headlines on Germany’s giant douchebank Deutsche Bank, negative interest rates joined at the hip with QE in Europe have been a disaster. They have promoted loan shrinkage and deposit growth, exactly the opposite of what was intended. Depositors are hoarding cash, not spending it, not lending it.
The fact is that central bankers simply have no clue how humans behave when faced with negative interest rates. Seeing that their previous program of negative rates wasn’t working, what did the ECB do? They did what any insane person would do. They made the rates even more negative.
Meanwhile, the Fed pretends that it controls the Fed Funds rate. It’s a joke. There is no Fed Funds market. The total amount of interbank Fed Funds outstanding in the US’s $12 trillion commercial banking system is $54 billion. No large banks in the US need to borrow Fed Funds. Only distressed banks would need to. It’s a meaningless, fake rate. The fixation on what the Fed will do with it next is another sign of collective media and institutional insanity as the financial and opinion elites impose their madness on the rest of society.
Needless to say, as confidence in the con game which these elites have been running collapses, and their incompetence and craziness becomes ever more clear to more people, it will not be good news for the financial markets. Sadly, the effects of all the crazy financial experiments and manipulation are only beginning.
This report fills in some of the details in painting a picture of these processes as they unfold.
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