What Will Happen When Fed Stops Buying Trillions in Treasury Bills?

September 29, 2009 (LPAC)—Pierre-Antoine Delhommais, one of Le Monde's better financial commentators, has a sharp attack on the G20 in this weekend's issue where, although repeating the mantra that "growth has restarted," he attacks the G20 leaders for not dealing with the coming explosion of new financial bubbles which are being formed before our very eyes. Delhommais points specifically to the U.S. Fed's hyperinflationary bailout, including buying trillions of dollars of U.S. Treasury bills.

"What will happen when the Fed stops its artificial support of Treasury bond markets, through massive purchases? Already suffocating, the burden on the public debt will become stifling." He concludes by noting that "at last glance, the diabolical clock of the world public debt shows $35.118 trillion dollars," referring to the Economist world debt clock on its website.

Earlier in the article, Delhommais had gone off on a ridiculous tangent about upcoming currency wars, unleashed by competitive currency devaluations by "wealthy" countries desperate to grease the export markets. In this context, he said, foreign exchange markets will be highly turbulent.

Lyndon LaRouche commented that "What they are looking at is markets: they're crazy. Because what happens then, at that point, is you get an effect like Germany 1923: everything in the system goes down. Nobody survives. There are no market-to-market considerations for anything."