The Federal Reserve is Setting Up Another Bubble With Latest Flood of Currency: From the Mike Church Show

(Audio & Transcript) Mandeville, LA - Remember that time in America's recent history when the burst of the housing bubble sent the entire country's economic sanity into oblivion? It wasn't that long ago and if you look around enough you can still feel it in the air. Now jump to 2010, headline of The Washington ComPOSTeclaims:

"If you are thinking of buying a house or refinancing a mortgage, the new action helps you. The Fed is pumping money into the economy by buying Treasurys, which has already pushed down long-term interest rates, including for mortgages."

Mike would like to point out that this is exactly how a bubble gets inflated and in 2004 and 2005 exactly how the bubble did get inflated. The housing bubble is a direct response to phony interest rates, and with Ben Bern-YANKME on Capitol Hill pumping money into the economy we are setting ourselves up for a relapse of this sickness we have suffered through caused by Leviathan. Will America ever use history as a learning tool?


Begin Mike Church Show Transcript

Mike: All right. AG, did you just – is it you that just sent me this economic nitwittery of what the Fed’s move means for you?

AG: That is on the front page of the Washington Post this morning, yes.

Mike: Did you read item no. 1? And of course, if you read it, then let me quiz you then, my good friend. You realize that that advice is absolutely backwards, don’t you?

AG: So it’s not good for us if we’re trying to buy a house or refinance a mortgage?

Mike: No. All right. How do bubbles get inflated? Especially, how does a housing bubble get inflated?

AG: False sense of wealth?

Mike: Phony interest rates? How did the last one get inflated? Phony interest rates. Held artificially low. So he’s going to print money, and the Washington Post is going to tell people to go out and buy houses? It’s going to be good for them because you’re going to get a low interest rate? Let me tell you what else you’re going to get. You’re going to get a property that’s overvalued because, if he inflates another housing bubble, a little mini Bernyankme bubble, that one’s going to bust, too. And you’re going to be sitting there in two years going [sobbing], Bernyankme told me the bank had low interest rates, and it’s worth 50,000 less than it was [sobbing]. That’s what’s going to happen.


I talked to a friend of mine, good friend of mine yesterday who is in the real estate appraisal business. And he and I discussed this very subject. And I actually said to him, I said, you know, people are going to be out there thinking, ooh, I get a lower interest rate, I might go buy a house. And he just shook his head because he said, yeah, his wife is nagging him to get a house. And I said, you told her what? And he said, I told her not no, but hell no. This is, now, look. If you just want to buy a house, and just want to know, well, then, go do it. Yeah, you’re not going to get a lower mortgage rate, correct. You’re buying a bubble house.

Here’s what the Washington Compost says. If you’re thinking of buying a home or refinancing a mortgage, the new action helps you. The Fed is pumping money into the economy by buying Treasuries, which has already pushed down long-term interest rates, including for mortgages. That is how a bubble gets inflated. That is the textbook way especially a housing bubble gets inflated. That’s how the last one got inflated. Look at the results of that. What did all the geniuses on CNBC and Fox Business News and what have you, and Larry Kudlow and all those guys, what did they tell people back in 2004, 2005? Buy. Interest rates are low. Hundred percent financing is cheap. Buy. This will never end. You’ll have an ATM machine, it’s called a house. Buy. How’s that working out for us?

Folks, here’s the other one. If you have significant investments in the stock market, it helps you. Lower interest rates on bonds have already prompted investors to bid up stock prices. On what? On the merit of the company? Again, you’re not buying the stock because it’s outperforming or because this company just invented the brand new widget. You’re buying it because it is participating in the bubble. It’s participating in the inflation of the currency. They’re not actually changing their business model. So what is ultimately going to happen? The Dow is going to crash. You can mark a freaking calendar. Just as the Earth is going to orbit the sun, that sucker is going to fall. And I’m not an economist. I do play one on the radio. But there’s some brilliant men out there that are telling me, watch out. Now, could you make some short-run money? Yeah, absolutely. But are you actually making anything? Or are you just making inflation? Economic nitwittery. Economic imbecility. There are guys like Jim Rogers, AG, our buddy. What do you think Jim Rogers would tell you to do if he were advising you today? What do you think, after Bernyankme did what he just did, what would he tell you to do?

AG: Buy silver or gold?

Mike: In addition to that, what else? What would Peter Schiff, what’s Peter Schiff going to say today? He’s probably going to tell his people, man, if you’re smart, you’ll probably go out and buy some other currencies. May buy some other currencies. You know what else is going to get bid up big-time? Commodities. You can buy wheat and other futures like that, because that stuff’s going to go through the roof. Mark the price of a pound of bacon today, ladies and gentlemen. And then come back, and we’ll talk about it in March, and we’ll see what a pound of bacon costs. Mark my words. Look, I’ve already noticed the spike in food prices. You’re already getting clobbered at the grocery store. And Bernyankme is only going to make it worse with this pumping of money.

I mean, folks, if it’s this easy, if this is all you do is you need some wizard, locked in a faraway central building with a bunch of pillars outside of it, to determine when you turn the money spigot off or turn it on, well, then, we ought to just stop this folly of even having an economy. What do we need an economy for? Just have Bernyankme print some money. Whenever there’s any problem or any hiccup in an actual market, don’t worry about it. We’ll never have to have – you know, the illusion here that no one is ever going to fail, and that we must not allow anyone anywhere to fail or experience any hardship or bankruptcy or what-have-you or foreclosures is ridiculous. I mean, this defies 8,000 years of recorded history. “Oh, but we’re Americans, Mike. You don’t know what you’re talking about, Mr. Church.” All right. So go read EuroPac.net. As a matter of fact, what does Schiff have up as his editorial? He usually writes one on Friday at EuroPac. Let’s check it out.

End Mike Church Show Transcript