4.5 Trillion Reasons The Market Won’t Crash!

Trillions- when you say it you have to say “With a “T””! Why, because we were used to the word billions, but as far as our national debt is concerned, that number didn’t last long! Ignore the political party affiliation below- both parties spend our tax dollars like drunken sailors- actually that’s an insult to drunken sailors, I apologize.

budget-ceiling

Just to reference and comprehend that number, for those who have a hard time visualizing – One Trillion- let’s use an example and use time. Suppose you wanted to count to One Trillion- start now……………one…..two…three… keep going.. four…five.. okay you get my drift if you count a number every 1 second- take a guess how it would take you to get to ONE TRILLION? 1 year? 2 years? 3years? 10? 20? 50? 100? No- not even close. It would take you, now get this 31,709 years and 9 and 1/2 months!! I know, I know it sounds crazy but the formula is here:

There are 24 hours in a day so you would count 24 X 60 mins x 60 sec = 86,400 seconds in one day. There are 365 days in a year so you would count 86,400 x 365 = 31,536,000 seconds in one year. To find how long it would take to count to a trillion dollars divide 1 trillion (1 followed by 12 zeros) by 31,536,000.

That is 1,000,000,000,000/31,536,000 =  31,709.79 years

So, to count to the amount that the Federal Reserve Bank has used to prop up our economy (ahem stock market) would take you- 142, 694.055 years. That is an awfully  large number!

With that kind of investment- do you think there is anything that the FED won’t do to preserve that amount of money in the debt stream. And exactly who do we (as in the USA) owe the money to? Well, conspiracy theory minded folks would have a field day with that one- but the answer is not easy to find. Congress was given the ability to coin, print and determine the value of money in the constitution Article I, Section 8, Clause 5– known as the coinage clause. yet, in December 1913- that right and ability was conferred upon a Central Bank called the Federal Reserve bank. Originally the Fed printed the money at cost and loaned it to the US treasury at face value and it was loaned from the Treasury to member banks with interest. The taxes you pay- do not go to running our government, as we are told or as we thought, the taxes you pay go towards servicing the debt on the money the Government borrows to run. Now the Fed doesn’t have to print and deliver printed bills- they just sell treasury bonds and treasury bills- The Fed sells this things on the good natured promise that the US has and will pay the amount back. Yet as of now the US is having a hard time servicing (paying) the interest payments of those bills and bonds- so they just issue longer term bills and bonds to pay off the shorter term B’s and B’s. If that scenario makes sense to you- it’s the same as putting your mortgage payment on your credit card- because it’s easier to make the minimum payment to your credit card then to pay the mortgage??

Ah….2008 all over again!

The FED can not and will not allow this market to move down- I feel NO MATTER WHAT. Listen to some of the DOOM DAY SAYERS- they are NOT wrong, everything they say is fact: Huge debt, lowest workforce participation rate since the 70’s, home equity armageddon (pre 2008 housing crash equity loans), over inflated P/E ratios, near zero interest rates, less then 3% GDP growth in spite of the 4.5 Trillion investment, lack of US manufacturing, decreased spending from baby boomers, dismal corporate earnings, the end of the petro dollar as China and Russia buy oil in native currencies, the rise of the ruble and yuan (remindi), slow down of growth in China, BRICS nations recessions, lack of demand for commodities (which drive down their prices), wage stagnation, loss of dollar purchasing power…. and this is just a partial list!!

The FED can’t let it crash- they just have to keep juggling balls, more and more balls in the air- with less hands to juggle, if they allow it to crash they may NEVER get those investors back, ever ……………………

but if there were a war or some other catastrophe (natural, terrorist or man made) on which to blame the market collapse, Then the FED can gets it re-valuation without blame …………………………………………………………….!

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