Capital Account -- 1/19/12
The Federal Reserve has more than tripled the size of its balance sheet since the financial crisis, printing money in order to do it. Whose decision was that? Not yours, unless you're one of the handful of member soy the federal open market committee (FOMC). Next week they meet – some are predicting more quantitative easing (QE) may be on the menu. But what has all this money printing really amounted to? After all, the extent to which base money created by the Federal Reserve is actually seeping into the broader monetary aggregates is rather disappointing. Much of this money has ended right back at the federal reserve in the form of excess reserves, earning a pathetically small amount of interest in return for the safety of bid daddy's deposit account. We have seen the same thing in europe with LTRO funded money going right back to the ECB and swelling those deposits above 500 billion euros. So, is this what happenes when banks refuse to lend? Is this what a private sector, balance sheet recession looks like? Well, we speak to Mike "Mish" Shedlock for answers to this. He is an advisor to Sitka Pacific Capital and author of the very popular blog, globaleconomicanalysis.blogspot.com. And speaking of bailouts, the mainstream media is looking to cash in on one with SOPA and PIPA. For the time being, thank god that there's the alternative financial media to tell you what's missing from that conversation. But could SOPA and PIPA the US anti-piracy bills change all of this? We've seen the protests from silicon valley…but today we'll break down why the financial blogosphere is going to "war against a never ending witch hunt," in the words of Mike "Mish" Shedlock.