Going on reading Ted Reese's book, examining the Fed behaviour he states:
>The Fed needs to push the interest rate lower not only to incentivise the borrowing of cheap capital but also so that the government can afford to service its debt – higher interest rates increase the debt-to-GDP ratio. But because doing this is achieved by pumping more and more recycled debt into the economy, the value of the dollar will continue to overinflate, pushing up the debt anyway and disincentivising buyers of the
currency, who will see that the tax base needed to pay back debt is shrinking even further.They will dump their worthless debt and instead invest in hard assets, the prices of which will inflate. When the interest rate hits zero and can go no lower, the rate will have to rise to tackle the inflation of hard assets and to incentivise government bondholders not to dump their bonds. But as interest rates go up,the debt-to-GDP will rise, the government won't be able to repay its debt and currency will lose its value.The Fed will have to purchase all the dumped bonds,which will send the national debt soaring ever-higher.
<Whatever central banks do, countries are going todefault.Hyperinflation is surely imminent.
And this time my questions are: 1) Isn't what he's stating in the first sentence the opposite of what actually happens? 2)How could Fed push interests lower by pumping more debt into the economy?
3) Also how could the dollar get "over inflated" when the fucking Central Bank is pumping money into the market?
It really seems to me that the first part of this paragraph is seriously fucked up, but if some anon could clarify me on this it would be GOLDEN.