Why Crypto Is Needed: The Fed Bailing Out Billionaires

The United States Federal Reserve is trying to keep the economy from falling off a cliff. Unfortunately, they are doing it following the same m.o. they always did.

It believes that saving the economy starts with saving Wall Street. After all, if the financial system collapses, the economy is done. Or so that is the thinking.

We now see some people starting to opine about this and how misguided it is.

Chamath Palihapitiya, chief executive of venture-capital firm Social Capital LP, brought this point up Thursday.

Is the Fed’s massive coronavirus stimulus package helping the ultra-rich at the expense of ordinary American workers?

Appearing Thursday on CNBC’s “Fast Money Halftime Report” Palihapitiya said the U.S. shouldn’t be bailing out billionaires and hedge funds when it’s the people on Main Street who are the ones actually getting hurt.

The main point that Palihapitiya is that when businesses enter bankruptcy, employees, as well as pensions, are protected. Those who speculated ended up losing their stake, ie the stock and bond holders.

Yet, according to him, that is how things should be. The speculators should not be protected at the expense of jobs. And this is exactly what the Fed is doing.

The Fed on Thursday set up a new $2.3 trillion lending program to help prop up small and mid-sized businesses.

But Palihapitiya argued that rather giving workers relatively small $1,200 checks, the U.S. would be better off giving everyone larger payments directly, and skip businesses entirely.

“It would be better for the Fed to have given half a million to every man, woman and child in the United States,” he said.

https://www.marketwatch.com/story/fed-should-pay-every-american-more-let-hedge-funds-and-billionaires-get-wiped-out-says-social-capital-ceo-2020-04-09?mod=home-page

This is the exact reason why cryptocurrency is needed. It is an industry that needs to grow rather quickly to combat what the central banks are doing.

We see a system that carries an ideology that mandates that those at the top are protected. This is not likely to change anytime soon.

The Fed suffers from it inherent belief in Keynesian economics. It mistakenly believes that it can stimulate demand, thus averting disaster.

If it followed this advice, and gave money directly to people, then it might be the case. However, when it pushes the money to the top of the food chain, it has little impact.

Perhaps we are seeing a shift in thinking starting to take place.

In the meantime, we need to construct our own system that excludes the shortcomings of the present one.

Humanity's future is at stake.