As Citizens Suffer Central Banks Flush Trading Houses With Trillions, Ease Corporate Strains
Central banks across the world have been increasing stimulus and letting inflation run high in order to combat the disastrous economic effects of the coronavirus outbreak response. The Bank of Japan has recently become the country’s largest stockholder and the European Central Bank is prepared to expand its colossal stimulus program. Meanwhile, Federal Reserve Chair Jerome Powell is calling on Congress to act fast on America’s stimulus program proposal as “the risk of overdoing it is less than the risk of underdoing it.”
Bank of Japan’s $434 Billion Treasure Chest of Exchange-Traded Funds
Central bankers are dizzy from all the talks of more economic stimulus and concerns of rising inflation across the globe. In 2020, these financial behemoths have injected massive amounts of stimulus into the hands of private banks and stockholders.
For instance on numerous occasions this year, the Bank of Japan (BoJ) has expanded the central bank’s stimulus program. BoJ board members have blamed Japan’s economic fallout on the Covid-19 outbreak. Reuters reports that the BoJ’s “primary tool to deal with the pandemic-striken economy” is “easing corporate funding strains.”
This corporate easement, if you will, has led to the BoJ becoming the largest stock owner of the country’s stocks with a $434 billion treasure chest of stocks. According to a report written by Shingo Ide, chief equity strategist at NLI Research Institute, in order to help support the Japanese economy, the BoJ purchased massive quantities of exchange-traded funds.
The BoJ’s stocks under management make it the first time ever, the central bank’s stash overshadows the Government Pension Investment Fund.
ECB Ready to Launch Colossal-Sized Stimulus Program, Federal Reserve’s Powell Prepared to Over Stimulate
The BoJ is not the only bank offering large sums of easement to the smaller banks and corporate sector. According to a recent report and a research note from Societe Generale ECB watcher Anatoli Annenkov, the European Central Bank (ECB) is ready to inject immense amounts of funding into the European economy.
The EU economy has been enduring the stress of excessive lockdowns again due to rising coronavirus cases. “The near term outlook remains abysmal, and the ECB will want to keep its focus on the short-term pitfalls until a clearer end to the pandemic is in sight,” Annenkov said on Wednesday.
Societe Generale and Annenkov expect the ECB to continue bond-buying until the end of 2021 and they also believe the ECB will add a supplementary 600 billion euros to the collection of smaller European banks.
Meanwhile, Federal Reserve Chair Jerome Powell and former Fed leader Janet Yellen have been calling on U.S. Congress to pass a new stimulus deal. At a recent hearing, Powell explained that the “risk of overdoing it is less than the risk of underdoing it.” However, according to a number of investigators, economists, and analysts, the U.S. central bank has already been overdoing it.
Critics Say the Central Banks Have Kept Wall Trading Houses Fat and Continue to Feed Them While Common Citizens Are Thrown Crumbs
Investigative reporters Pam and Russ Martens from wallstreetonparade.com have already exposed the Fed in numerous reports outlining how the central bank sluiced trading house Wall Street bankers with $9 trillion, while giving a measly one-time check to American citizens.
On December 9, the Martens reported on the Financial Stability Oversight Council’s (F-SOC) recently published 2020 Annual Report. The funding of Wall Street trading houses did not stop in June as the Fed made it seem at that time.
Instead, the New York branch of the U.S. central bank “stopped reporting how many billions of dollars a week it was funneling to miscreant mega-banks on Wall Street.” In the meantime, the Martens stress “food pantry lines grew by miles across the U.S. and 3.3 million small businesses were forced to shutter.”
While millions of Americans are unemployed and hungry thanks to government-enforced lockdowns, the Fed has kept the stomachs of Wall Street full at all times. Spencer Schiff, the son of the famed economist and gold bug Peter Schiff, recently said it’s unfathomable to contemplate how much the U.S. money supply has grown.
“According to data that [was] just released by the Federal Reserve, the U.S. money supply (M2) has now increased by more than 25% over the past year for the first time on record,” Schiff tweeted. “This rate of monetary inflation is astonishing,” he added.
The situation is the same with nearly every central bank worldwide as central planners have eased the worries of corporations and banks but have left the citizens out in the cold. This is why many individuals wholeheartedly believe they must hedge with assets like cryptocurrencies and safe havens like precious metals.
The horrid macroeconomic circumstances across the globe are clear and blatant indicators that the world’s central banking system during that last century has been an utter failure.
What do you think about the actions of the central banks worldwide and all the stimulus programs? Let us know what you think about this subject in the comments section below.
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