By F. McGuire NewsMax
Newsmax Finance Insider and former U.S. Office of Management and Budget Director David Stockman claims that the Federal Reserve is "lost" and needs to resign because the central bank has pushed the nation to the brink of economic collapse.
“What they’ve essentially done is create another huge bubble and they’re about ready to be repudiated because the bubble’s gonna collapse at the very time that we’re heading into the next recession,” he recently told Bloomberg television.
“I think the Fed is completely lost,” he told Bloomberg television. “You can’t have seven years of zero-cost money without creating huge distortions in the financial market,” he said.
“The world economy is deflating and shrinking,” the Newsmax Finance Insider said. “Look at all the numbers: business sales are down five percent from their peak; inventories relative to sales are at recession levels; and capex orders are down 10% from a year and a half ago,” he said. “Everywhere you look in the U.S. economy, there is weakness, except for the phony numbers put out by the BOS [Bureau of Statistics],” he alleged.
Stockman said he believes that the world economy is being driven by “a cabal” of central banks that are “wrecking the financial system and driving the whole world economy to a huge crisis.”
For its part, the Federal Reserve is keeping a key interest rate unchanged in light of global pressures that risk slowing the U.S. economy, the AP reported.
As a result, Fed officials are forecasting that they will raise rates more gradually this year than they had envisioned in December. The officials now foresee two, rather than four, modest increases in their benchmark short-term rate during 2016.
The Fed said Wednesday that the economy has continued to grow at a moderate pace but that the global economy and financial markets still pose risks. Offsetting the threats, the Fed said in a statement after a policy meeting that it foresees a further strengthening in the U.S. job market. It also expects inflation, which has stayed persistently low, to reach the Fed's 2 percent target in two to three years.
"Our first take on this is that it probably leans slightly more dovish, relative to expectations," Tom Porcelli, chief U.S. economist at RBC Capital Markets in New York, told Reuters.
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