The United States government goes into debt more and more every day and borrows money to pay for everything. This includes military expenditures, tax cuts, stimulus programs, and a variety of other public spending.
However, this is only part of the story. The other big part of the debt problem is that our government has made many, many off-balance sheets promise to banks, pensions, and state and local governments. These obligations are not paid back to the taxpayers but rather to the bankers.
This means that, at least in some sense, the banks make the decisions about the interest rates paid on government securities. That’s why, in recent years, many of the world’s biggest banks – including Barclays, UBS, JPMorgan Chase, and the Royal Bank of Scotland – have been caught manipulating one form or another of the price of these instruments. They’ve been fined billions of dollars, but so far, no individual has been arrested and prosecuted. This may indicate an emerging conspiracy – one in which the prices of currencies, commodities, and even interest rates are being set from above. It’s a dangerous, unchecked power. But, as always, we must be wary of putting too much stock in conspiracy theories.
Biosludge
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