2023: Prognostication & Prophecy (Cont.)
Warning: this article may scare some people, so if you have the guts to read all the way through it, be prepared for a frightening wake-up call. In this 2nd part of the Great Recession of 2023, I will start off by sharing with you a few basics surrounding economics. Within this discussion, I’m going to review the “Business Cycle” and where the U.S. currently stands regarding inflation, recession, or depression. If you are a seasoned economist or well-schooled surrounding the factors that impact the economy, please bear with me so that I can come to a conclusion and make a point.
The Federal Reserve was formed in 1913 to set monetary policy and enact changes to keep our nation’s monetary system stable. Later on, they were set with the tasks of keeping both inflation and employment at specific levels through the manipulation of the monetary policy. For example, changing the Discount Rate, which trickled downward to the Federal Funds rate (lowest possible rates charged between regional Federal Reserve banks), and eventually upward to directly impact consumers through lending rates. The Fed were handed their “guts on a platter” when the Great Depression was in full force (around 1930–31) and had to really begin going to work to stabilize a nation “reeling” from economic disaster. The founder of modern economics showed up in the U.S. from England to help them out around 1935, namely John M. Keynes. In 1936 we adopted one of his ideas that ended up helping pull us out of the Depression. At the time, our nation was experiencing unprecedented deflation (over 18 months of greatly reduced and progressively declining GDP), and enormous unemployment levels of up to 15% in large cities. John Maynard Keynes’ new idea was labelled “Keynesian Theory” or the Theory of Employment, Interest, & Money. Later called “Depression Economics”. Keep this in mind, as I relate this to today’s events. “Keynesians” teach that by increasing “Big Government” deficit spending (to help job creation through public projects), keeping income taxes stable, and inducing consumer spending through “entitlement programs” then the Depression would be neutralized.
It should be noted that the Keynesian Theory of economics also includes a monetary element, namely reductions in bank reserve requirement to spark consumer…