The Great Ponzi

Mon, Nov 28, 2011 - 9:36am

I have maintained for years that the ongoing U.S. federal deficit is being actively funded by the Fed, through their primary dealers. More evidence has emerged today due to some great reporting by Bloomberg.

It's quite simple, actually. The U.S. government has a spending problem. Again this year, it will spend about $1,500,000,000,000 more than it takes in in tax revenue. OK, so where do we get that $1.5T? By borrowing, of course. The problem is: Folks aren't exactly lining up to loan the U.S. billions and billions of dollars at 1-2% interest. In a free and fair market, rates would rise to the point where buyers would emerge and a new equilibrium would be reached. However, rates cannot be allowed to rise so, what to do?

Since 2008, the primary dealer banks have had virtually unlimited access to the Fed's "discount window". Through this lending facility, banks are able to borrow nearly infinite amounts of money from the Fed. What do they do with this money? They buy treasury bonds and notes! What a deal! Instead of creating the obvious problems associated with overt money printing to fund the U.S. deficit, the Fed funds the deficit covertly by having their PDs borrow funds at 0% and "re-invest" the money into treasuries. All the while, the big banks book the risk-free spread as profit, report healthy earnings on CNBS and pay their executives and traders fat and lavish bonuses. Pretty slick, huh? You don't believe me? OK, read this:

Another classic Fed/TBTF/Congressional shell game. Watch the right hand while the left does all the real damage.

While the country bickered over $700B in TARP, the Fed was secretly doling out $7.7T through the discount window. Let's actually lay out the numbers, just in case you don't catch the gravity of this:

$700,000,000,000 in TARP

$7,700,000,000,000 in actual Fed lending



Well, by now, you know. The ultimate question is: Does it matter? Is there anything you can do, anyway? You can rally with the "tea partiers" but the spending and the corruption continues. You can march with the "occupiers" but the power base and the bonuses continue unabated.

I'm sorry to say that all you can do is protect yourself. By visiting this site and others such as ZeroHedge, you've educated yourself. You now see what's really going on. Continue to prepare. The day is coming when the music will finally stop and the entire ponzi will collapse. Continue buying and stacking. Continue warning others and counseling them to do the same.


About the Author

turd [at] tfmetalsreport [dot] com ()


Nov 28, 2011 - 9:46am



Thanks alot for the insite Turd, it is greatly appreciated

Nov 28, 2011 - 9:46am

I am my own central bank..... a continuing path towards personal liberty...

Nov 28, 2011 - 9:47am


I pity the fools who tell me to save USD in a "high yield" CD.

I just keep telling people:

  • water
  • food
  • precious metal
  • guns
  • non-grid heat/power alternative
Nov 28, 2011 - 9:49am

first??? Thanks Turd

I try to make sense of this to my family, who is educated, ( 6+ each) and they do not see it the way we do. What hope is there for the masses who simply watch American Idol, and thinking of BLack Friday as a highlight of the year, and all that is good in America.

The amrkets are up 290 on the (reported false) rumors,

amazing. what is one to do???? yeah keep stacking, which I do,..... it really is no wonder that things continue the way they are.

TO watch congress and senate with their cronyism (?) make a person ill, and they make the laws, good grief

no wonder the rest of the world looks at us with contempt

Nov 28, 2011 - 9:54am

B&B Found Guilty For War Crimes

The Kuala Lumpur War Crimes Tribunal found former British prime minister Tony Blair and his American counterpart George W. Bushguilty and will lobby for them to be charged internationally for war crimes. Good luck with that. Nevertheless it's a noble decision and deserves attention. Hopefully these criminals and many alike will get their fair verdict in the future.

Bush, Blair found guilty of war crimes in Malaysia tribunal

33 and a turd
Nov 28, 2011 - 9:55am
Nov 28, 2011 - 9:55am

when does 7T$ get reconzied

when will it get reconized by the street, the masses...think about it --this amount of $s should have us at santa's 10000$ gold already

Nov 28, 2011 - 9:55am

Even Kiyosaki is prepping

I know many of you are not fans of Robert Kiyosaki... But I recently heard him speak about the 5 Gs on a free podcast

  • Gold
  • Guns
  • Grub
  • Ground
  • Gas

He will certainly still accept your money to train you how to get rich in business or Real estate, but this was a twist that surprised me. I like the Alliteration--helps me remember what to tell people on how to prepare.

Visit the FAQ page to learn how to track your last read comment, add images, embed videos, tweets, and animated gifs, and more.

Nov 28, 2011 - 9:58am

Gold Behaves as Currency

This article asks which currency correlates best to gold, and the answer is both the Japanese Yen and the Swiss Franc. The analysis is that these are valued as reserve currencies, and that therefore gold should also be viewed as a reserve currency, rather than as a commodity. In fact, they support the view that gold is a safer reserve currency than the others.

Nov 28, 2011 - 10:00am


I like him. I saw him over 5 years ago. And he was talking gold, silver and oil.. That was where he was recommending people put their money. That's where he said the rich where putting the money. I have respect for him..don't know him, but he was on the gold silver ban waggon even in the 90s

Subscribe or login to read all comments.


Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 3/30

3/31 9:45 ET Chicago PMI
4/1 8:15 ET ADP Employment
4/1 9:45 ET Markit manu PMI
4/1 10:00 ET ISM manu PMI
4/2 10:00 ET Factory Orders
4/3 8:30 ET BLSBS
4/3 9:45 ET Market service PMI
4/3 10:00 ET ISM service PMI

Key Economic Events Week of 3/23

3/24 9:45 ET Markit flash PMIs
3/25 8:30 ET Durable Goods
3/26 8:30 ET Weekly jobless claims
3/27 8:30 ET Personal Inc and Spending

Key Economic Events Week of 3/9

(as if these actually matter)
3/11 8:30 ET CPI
3/12 8:30 ET weekly jobless claims
3/12 8:30 ET PPI
3/13 8:30 ET Import Price Index

Key Economic Events Week of 3/2

3/2 9:45 ET Markit Manu PMI
3/2 10:00 ET ISM Manu PMI
3/2 10:00 ET Construction Spending
3/4 8:15 ET ADP employment
3/4 9:45 ET Markit Service PMI
3/4 10:00 ET ISM Services PMI
3/5 8:30 ET Productivity & Unit Labor Costs
3/5 10:00 ET Factory Orders
3/6 8:30 ET BLSBS
3/6 10:00 ET Wholesale Inventories

Key Economic Events Week of 2/24

2/25 9:00 ET Case-Shiller home prices
2/26 10:00 ET New home sales
2/27 8:30 ET Q4 GDP second guess
2/27 8:30 ET Durable Goods
2/27 11:30 ET Goon Evans speech
2/28 8:30 ET Pers Income and Spending
2/28 8:30 ET Core Inflation
2/28 9:45 ET Chicago PMI

Key Economic Events Week of 2/17

2/18 8:30 ET Empire St Manu Idx
2/19 8:30 ET Producer Price Idx
2/19 8:30 ET Housing Starts & Bldg Perms
2/19 2:00 ET January FOMC minutes
2/20 8:30 ET Philly Fed
2/21 Fed Goons all day at Chicago Conf.
2/21 9:45 ET Markit flash Feb PMIs

Key Economic Events Week of 2/10

2/11 10:00 ET Job Openings
2/11 10:00 ET CGP Hump-Hawk House
2/12 10:00 ET CGP Hump-Hawk Senate
2/13 8:30 ET CPI
2/14 8:30 ET Retail Sales
2/14 9:15 ET Cap Ute & Ind Prod
2/14 10:00 ET Business Inventories

Key Economic Events Week of 2/3

2/4 10:00 ET Factory Orders
2/5 8:15 ET ADP Employment
2/5 9:45 ET Markit Service PMI
2/5 10:00 ET ISM Service PMI
2/6 8:30 ET Productivity & Unit Labor Costs
2/7 8:30 ET BLSBS
2/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 1/27

1/28 8:30 ET Durable Goods
1/28 10:00 ET Consumer Confidence
1/29 10:00 ET Pending Home Sales
1/29 2:00 pm ET FOMC Fedlines
1/29 2:30 pm ET Powell presser
1/30 8:30 ET Q4 GDP first guess
1/31 8:30 ET Pers Inc and Spending
1/31 9:45 ET Chicago PMI
2/2 10:00 pm ET Chiefs win SB LIV

Key Economic Events Week of 1/13

1/14 8:30 ET CPI
1/14 9:00 ET Goon Williams
1/15 8:30 ET PPI and Empire Fed
1/16 8:30 ET Retail Sales and Philly Fed
1/17 8:30 ET Housing Starts
1/17 9:15 Et Cap Ute and Ind Prod

Forum Discussion

by SilveryBlue, 1 hour 52 min ago
by SilveryBlue, 2 hours 19 min ago
by Green Lantern, 2 hours 25 min ago
by ag1969, Mar 29, 2020 - 9:58pm
by sierra skier, Mar 29, 2020 - 5:44pm