Federal Reserve purchases own debt, endangers the dollar

Years ago, the Fed stopped publishing the M3 Money Supply indicator, which was used to measure (among other things) inflation and the amount of money available in circulation.  The M3 indicator is now showing inflation similar to what was seen in the 1930's, probably indicating that we have succeeded in extending this recession by foolishly diving head first into Keynesian economic spending.  The same thing was accomplished during the Great Depression, where the United States prolonged the depression by establishing massive federal government social programs and engaging in debt spending.  The rest of the world did not follow our lead and subsequently exited the depression nearly a decade before the United States.  The depression was only known as the "great" depression here.  Similar action was taken in Japan in the 1990's, which led to what the Japanese now call "The Lost Decade."  Federal debt spending has never worked any time it has been tried.  It is truly a "failed policy of the past" and history bears this out very clearly.

http://www.telegraph.co.uk/finance/economics/7769126/US-money-supply-plunges-at-1930s-pace-as-Obama-eyes-fresh-stimulus.html

Now, the Fed (in the story I sent out earlier) is purchasing US Government debt, or monitizing the debt.  This literally means that the Federal Reserve is printing money to loan to the government, because the government has been much less successful in selling our debts to places such as China recently.  The United States is becoming a money hole and foreign governments no longer recognize us as a good investment - they don't know whether or not they'll get their investment back.  As such, we have resorted to the situation we are in now, where we are taking money out of one pocket and putting it in the other.  (The only alternative is auctioning debts at an increased interest rate or for a shorter period, i.e. 6 months rather than 60, which has been happening for several months.  The problem now is that we can't raise our interest rates high enough to entice foreign interests to invest.)

http://www.bloomberg.com/news/2010-08-10/fed-to-reinvest-principal-on-mortgage-proceeds-into-long-term-treasuries.html

If the current actions continue at this pace, the US Dollar is in serious danger of hyperinflation.  We have already opened all of the valves that the federal government can open to try to stop the recession - there aren't any left to open.  We are in serious risk of not only a W-shaped recession, but a severe economic collapse never before seen in the United States.

In love of liberty,
The Bulletproof Patriot