By Gregory Mannarino TradersChoice.net
If central banks do not find another mechanism to continue to inflate, IMMEDIATELY, the entire global financial system will melt down.
The current central bank-run financial system is 100 percent debt based.
What this means is a debt based financial/economic system can only function if more debt is constantly added/borrowed into existence—and the moment this stops, the financial system in its entirety implodes.
War, expanding wars, Congressional acts/policies, disease processes, warp speed vaccines, drugs, engineered crisis after crisis, etc. are all mechanisms pushed upon an unsuspecting public to pull debt relentlessly and exponentially into the system.
Not only does the system demand that more debt be created, and henceforth pulled into existence, but it must also do so on an ever-increasing basis just to sustain the current environment.
The borrowing of debt into existence, which at its core demands that the currency expand/inflate, is MASSIVELY inflationary.
Currently the world is being sold a lie, which is inflation is running rampant because rates are too low. The fact here is simple: raising rates is meant to KILL demand, not lower inflation.
To lower inflation, all the Federal Reserve or any central bank must do is contract the money supply. If in fact the Federal Reserve really wanted to lower inflation, they would increase the capital reserve requirement of the banks, which currently sits at zero, this would contract the money supply.
The last thing that ANY central bank, especially the Federal Reserve wants to do in this environment is to contract the money supply, in fact, they want to expand it/inflate it.
The power of any central bank resides in ONE THING, its ability to inflate… PERIOD.
How do you kill a central bank? Simple, prevent them from issuing A SINGLE DOLLAR OF MORE DEBT.
Central banks will NEVER give up their ability to inflate, it would take a full-on revolution of the people against central banking to make that happen. As it stands, central banks are the most powerful organizations on the planet, none more so than the Federal Reserve which has the FULL backing of the U.S. Armed Forces, which includes its nuclear arsenal— henceforth the petrodollar.
What we can fully expect moving forward is yet again some other kind of mechanism which will allow the Federal Reserve to continue to inflate.
Another disease process possibly… Expanding war… Some new Congressional act/policy… ANOTHER CRISIS… Some new way to borrow/buy debt.