{"id":68705,"date":"2015-02-26T17:54:22","date_gmt":"2015-02-26T22:54:22","guid":{"rendered":"http:\/\/countingpips.com\/?p=68705"},"modified":"2015-02-26T17:54:22","modified_gmt":"2015-02-26T22:54:22","slug":"audit-the-fed-weve-already-done-that-well-kind-of","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2015\/02\/audit-the-fed-weve-already-done-that-well-kind-of\/","title":{"rendered":"&#8220;Audit the Fed&#8221;? We&#8217;ve Already Done That (Well, Kind of)"},"content":{"rendered":"<div id=\"inves-3373350440\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">February 26, 2015<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><h3 style=\"margin-top: 0px;\"><span style=\"font-size: small;\">Our conclusion: The Fed is not in control of the economy &#8212; here&#8217;s why <\/span><\/h3>\n<h3 style=\"margin-top: 0px;\"><span style=\"font-size: small;\">By Elliott Wave International<\/span><\/h3>\n<p>If there&#8217;s one thing the Federal Reserve Board of the United States is <i>not <\/i>known for, it&#8217;s assertive language. After all the obfuscation and verbal sidestepping, Fed speak is usually as easy to comprehend as Marlon Brando&#8217;s Godfather character Don &#8220;Mumbles&#8221; Corleone.<\/p>\n<div style=\"text-align: center; margin: 0in 0in 0pt;\" align=\"center\"><b><span class=\"LimelightEmbeddedPlayer\"><script src=\"\/\/video.limelight.com\/player\/embed.js\"><\/script><object id=\"limelight_player_969701\" class=\"LimelightEmbeddedPlayerFlash\" data=\"\/\/video.limelight.com\/player\/loader.swf\" type=\"application\/x-shockwave-flash\" name=\"limelight_player_969701\" width=\"480\" height=\"321\"><param name=\"movie\" value=\"\/\/video.limelight.com\/player\/loader.swf\" \/><param name=\"wmode\" value=\"window\" \/><param name=\"allowScriptAccess\" value=\"always\" \/><param name=\"allowFullScreen\" value=\"true\" \/><param name=\"flashVars\" value=\"playerForm=Player&amp;channelId=05e6cde4c34443f0ab49c5bf531c5806&amp;deepLink=true\" \/><\/object><script>\/\/ <![CDATA[\nLimelightPlayerUtil.initEmbed('limelight_player_969701');\n\/\/ ]]><\/script><\/span><\/b><\/div>\n<p>But on February 24, Fed chairwoman Janet Yellen was 100% candid in expressing her disapproval of the controversial bill known as &#8220;Audit the Fed&#8221; &#8212; legislation that would open the\u00a0central bank\u00a0up to full government regulation and scrutiny:<\/p>\n<blockquote><p>&#8220;I want to be <b>completely clear<\/b>.<\/p>\n<p>I <b>strongly oppose<\/b> &#8216;Audit the Fed'&#8221;<\/p><\/blockquote>\n<p>No &#8211; Confusion &#8211; There!<\/p>\n<p>But, whatever side of the bill you stand on &#8212; nay or yay &#8212; for us, the prospect of pulling back the curtain on the most elusive quasi-government body seemingly besides the C.I.A. is irrelevant. Because we at Elliott Wave International have long since conducted our own &#8220;audit&#8221; of the Fed &#8212; and the results are like nothing you&#8217;ve ever heard before from the mainstream pundits.<\/p>\n<p>The purpose of our &#8220;audit&#8221; was simple: Determine, once and for all, if the most powerful monetary institution on the planet does, in fact, have the power to control the U.S. economy or marketplace.<\/p>\n<p>We published our findings in a 30-plus page eBook titled <b><a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa486&amp;dy=aa022615&amp;url=http:\/\/www.elliottwave.com\/club\/Understanding-the-Federal-Reserve-Bank-System.aspx?code=41531%26articleid=5357\">&#8220;Understanding the Fed,&#8221;<\/a><\/b> a compilation of excerpts from the selected works of EWI president Robert Prechter &#8212; including his 2002 best-seller <i>Conquer the Crash<\/i> and several past <i>Elliott Wave Theorist <\/i>publications. This riveting report articulates in no uncertain terms that the two main tools in the Fed&#8217;s arsenal &#8212; interest rate policy and money creation &#8212; will be, and always have been, futile against the forces of deflation.<\/p><div id=\"inves-529015928\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<p>These two passages from the &#8220;Understanding the Fed&#8221; eBook set this radical claim in motion (excerpted from Chapter 13 of <i>Conquer the Crash<\/i>):<\/p>\n<blockquote><p>&#8220;The problems that the Fed faces are due to the fact that the world is not so much awash with money as it is awash with credit&#8230; For the Fed, the mass of credit that it has nursed into the world is like having raised King Kong from boyhood as a pet. He might behave, but only if you can figure out what he wants to keep him satisfied.<\/p>\n<p align=\"center\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.elliottwave.com\/images\/freeupdates\/2_25_15fed1.jpg\" alt=\"\" width=\"498\" height=\"371\" \/><\/p>\n<p>&#8220;Conventional economists excuse and praise this [Federal Reserve] system under the erroneous belief that expanding money and credit promotes economic growth, which is terribly false. It appears to do so for a while, <b>but in the long run, the swollen mass of debt collapses of its own weight, which is deflation, and destroys the economy<\/b>.&#8221;<\/p><\/blockquote>\n<p>In the decade since <i>Conquer the Crash <\/i>first brought these assertions to light, the Fed has only lived up to its limitations.<\/p>\n<p>First, from 2003 to 2007, the central bank attempted to remove the froth from the bubbling housing market and cool the overheated credit sector via 17 interest rate HIKES &#8212; from a half-century low of 1% to 5.25%. Yet, in 2007-2009, the top blew off both sectors anyway.<\/p>\n<p>Hoping to finesse the economy into a &#8220;soft&#8221; landing, the Fed then adopted the opposite tactic: Slashing rates 10 times between 2007 and 2008 to a record low of 0%, and from 2009 to 2012, embarking on the largest inflationary campaign in history via three rounds &#8212; $4.5 Trillion &#8212; of quantitative easing (QE).<\/p>\n<p>Yet, again, all of these measures failed to prevent:<\/p>\n<ul>\n<li>The worst financial meltdown since the Great Depression<\/li>\n<li>A full-blown bear market in oil and commodity prices, which stand at a 6- and 12-year low respectively<\/li>\n<li>A stalled housing and jobs market<\/li>\n<li>An inflation rate that has been running below the Fed&#8217;s 2% target for nearly three years<\/li>\n<\/ul>\n<p>And, as our updated chart of &#8220;Total Credit Market Debt as a Percentage of GDP&#8221; below shows, the deflationary scenario outlined in <i>Conquer the Crash <\/i>&#8212; when &#8220;the swollen mass of debt collapses of its own weight&#8221; &#8212; is also coming to pass:<\/p>\n<p align=\"center\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/www.elliottwave.com\/images\/freeupdates\/2_25_15fed2.jpg\" alt=\"\" width=\"500\" height=\"351\" \/><\/p>\n<p>Whatever action Congress decides to take regarding &#8220;Audit the Fed,&#8221; the fact remains: One of the most comprehensive and objective inventories of the Fed&#8217;s actual economy-saving abilities is not on Capitol Hill. It&#8217;s right here, in EWI&#8217;s 30-plus page &#8220;Understanding the Fed&#8221; eBook.<\/p>\n<p>The best part is, the entire report from start to mind-blowing finish is available to all Club EWI members, <b>100% free<\/b>.<\/p>\n<p><a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa486&amp;dy=aa022615&amp;url=http:\/\/www.elliottwave.com\/club\/Understanding-the-Federal-Reserve-Bank-System.aspx?code=41531%26articleid=5357\">So, what are you waiting for? Join our Club EWI community today (350,000 members strong!) and start reading the full, free eBook immediately &#8212; or at your leisure<\/a>.<\/p>\n<hr \/>\n<div>\n<p style=\"padding-top: 10px; border-top: solid 1px #CCCCCC;\"><em>This article was syndicated by Elliott Wave International and was originally published under the headline <a href=\"http:\/\/www.elliottwave.com\/r.asp?acn=9cp&amp;rcn=aa486&amp;dy=aa022615&amp;url=http:\/\/www.elliottwave.com\/freeupdates\/archives\/2015\/02\/26\/-Audit-the-Fed--We-ve-Already-Done-That-%28Well,-Kind-of%29.aspx\"><strong>&#8220;Audit the Fed&#8221;? We&#8217;ve Already Done That (Well, Kind of)<\/strong><\/a>. EWI is the world&#8217;s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.<\/em><\/p>\n<p style=\"padding-top: 10px; border-top: solid 1px #CCCCCC;\">\n<p style=\"padding-top: 10px; border-top: solid 1px #CCCCCC;\">\n<p style=\"padding-top: 10px; border-top: solid 1px #CCCCCC;\">\n<p style=\"padding-top: 10px; border-top: solid 1px #CCCCCC;\">\n<p style=\"padding-top: 10px; border-top: solid 1px #CCCCCC;\">\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Our conclusion: The Fed is not in control of the economy &#8212; here&#8217;s why By Elliott Wave International If there&#8217;s one thing the Federal Reserve Board of the United States is not known for, it&#8217;s assertive language. After all the obfuscation and verbal sidestepping, Fed speak is usually as easy to comprehend as Marlon Brando&#8217;s [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-68705","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/68705","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=68705"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/68705\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=68705"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=68705"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=68705"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}