Over the last few years, the Tenth Amendment Center has been covering state efforts that chip away at the Federal Reserve’s monopoly on money by facilitating and encouraging the use of gold and silver. The Federal Reserve’s influence goes far beyond the economy. Its existence facilitates the actions of the bloated, unconstitutional federal government we have today. Without the Fed lending it money and creating dollars out of thin air, the federal government couldn’t operate as it does today.
As Ron Paul said during an event after his Senate committee testimony in favor of an Arizona bill repealing the state’s capital gains taxes on gold and silver, dealing with the Fed is really about the size and scope of government.
“If you’re for less government, you want sound money. The people who want big government, they don’t want sound money. They want to deceive you and commit fraud. They want to print the money. They want a monopoly. They want to get you conditioned, as our schools have conditioned us, to the point where deficits don’t matter.”
I originally wrote the following article for SchiffGold. It reveals just how much impact the Federal Reserve has and why it’s so important to end its monopoly on money.
Could we be on the verge of a retail apocalypse?
February marked the third straight month of declining retail sales. Analysts had not expected another drop, but they got one nonetheless. Sales fell 0.1% in February. Analysts had expected an uptick of 0.3%.
This is not good news for a retail sector that is already teetering on the brink.
This month, we also got word that Toys R Us plans to close all of its stores. The giant toy retailer announced bankruptcy last fall. The TRU filing ranks as the second-largest US retail bankruptcy ever. Toys R Us had $6.6 billion in assets at the time of filing. Only Kmart was bigger. It had $16.3 billion in assets when it went bankrupt in 2002.
Toys R Us is the most visible proof that the air is rushing out of the retail bubble.
It’s easy to finger-point at the Amazon and blame it for the black cloud enveloping the brick and mortar retail sector. In fact, online sales didn’t kill Geoffery the giraffe. Massive corporate debt was the culprit. And massive corporate debt is endemic in the retail sector.
The story behind the Toys R Us bankruptcy gives us a glimpse at a fundamental problem eroding the strength of the US economy – easy money created by Federal Reserve monetary policy. The ability to borrow a lot of money at low interest rates fuels borrowing and speculation. Malinvestment distorts the economy and inflates bubbles that eventually pop.
Over the last 20 years, the Fed has inflated and maintained a giant retail bubble.
All of that debt is beginning to come due. In an in-depth report published last fall, Bloomberg reported that $1.9 billion in high-yield retail borrowing will come due in 2018, according to Fitch Ratings Inc. A