This week’s coordinated interest rate cuts by central banks cannot work, because they further fuel the hyperinflation that will destroy every financial institution and national economy—whether “solvent” or not.
Lyndon LaRouche called the coordinated rate cut, “a new form of insanity. It’s a clear sign of panic, but it’s also a formula for hyperinflation. And it’s a psychological formula for hyperinflation, as you see in the German case. This is 1923, this time on a global scale.”
The way hyperinflation is erupting can be seen in the U.S. Federal Reserve’s Term Auction Facility (TAF):
In late 2007, the Term Auction Facility was established with a $40 billion limit.
By September, that limit had blown out to $150 billion.
On September 29, the limit was doubled to $300 billion.
On October 6, the Fed increased it to $900 billion.
In response to the October 7 decision by the Federal Reserve to buy an undetermined amount of unsecured commercial paper, including from non-financial companies, LaRouche exclaimed: “More hyperinflation! More blowout! Don’t assume it will stop just with the $1.6 trillion size of the commercial paper market at present. Who knows how much is out there? When you start getting these derivatives back in, you’re going to find out that many orders of magnitude greater, are really out there. That’s what the pressure is. The pressure is this vast derivatives bubble, in the quadrillions of dollars, which is larger than the whole world economy. And that’s what’s crashing in. People are trying to save that bubble.”
No alternative
The daily, panicked bailouts by central bankers and their puppet governments and the daily failures of those bailouts, point to the one irrefutable reality: there is no alternative to a complete re-organisation of the system, along the lines of Lyndon LaRouche’s New Bretton Woods international reorganisation, and his Homeowners and Bank Protection Bill—freeze the system, protect the people, write off the trillions in unpayable, worthless paper, keep what’s real, and emerge with a heavily regulated banking system.
A LaRouche Youth Movement/Citizens Electoral Council delegation will be in Canberra next week, meeting federal MPs on the Homeowners and Bank Protection Bill.
More information on the Homeowners and Bank Protection Bill is available by clicking here.
Click here to join CEC as a member.
For a complimentary copy of 1932, the documentary which shows the historical reasons for the global financial crisis, click here.
