Faber News Flow

We recently have discussed both the importance of recessions and how the ongoing rescues are ruining capitalism.  However, while the data is clear that ongoing stimulus programs lead to weaker economic growth and a rising wealth gap, is the Fed stuck with  "forever stimulus?" Such was a point that Mohammed El-Erian recently made, stating: "They are increasingly on what I call a no-exit paradigm."  To understand the problem, we have to go back to the beginning. As we noted in our article on financial rescues, the bailouts and stimulus programs started in 2008 when the Federal Reserve intervened with the insolvency of Bear Stearns. They haven't stopped since. To date, the Federal Reserve, and the Government,  have pumped more than $36 Trillion into the economy. As shown below, the amount of economic growth achieved has been minimal during that same time frame.  (The chart is the cumulative growth of interventions compared to the incremental increase in GDP.) What