Fed Laundering Treasury Purchases to Disguise What’s Happening-Paul Craig Roberts

Dr. Paul Crag Roberts: Belgium and US Treasury DebtBy Greg Hunter’s USAWatchdog.com 

In his latest article, former Assistant Treasury Secretary Dr. Paul Craig Roberts says, “The Fed is the great deceiver.”   Why is he making this shocking accusation?   The reason is tiny Belgium’s whopping purchase of $141 billion in Treasury bonds earlier this year.   Dr. Roberts explains, “We know that Belgium didn’t have any money to buy $141 billion worth of bonds over a three month period.  That sum comes to 29% of the Belgium GDP.  So, they don’t have a surplus in their budget that is 29% of their GDP, and they don’t have trade or current account surplus in that amount.  In fact, everything is in the red.  Their budget deficit is in the red, and their trade and current accounts are in the red.  So, Belgium didn’t have the money, and yet, they managed to pick up $141.2 billion in U.S. Treasuries over a three month period.  So, where did they get the money?”  Dr. Roberts, who holds a PhD in economics, goes on to say, “We know their central bank couldn’t have printed euros to buy the bonds with because the Belgium central bank can’t print euros.  Belgium is part of the euro system and has lost the ability to create its own money.  So, the only source for that kind of money would have been the Federal Reserve.  The Federal Reserve thought it needed to hide the fact it was buying $141 billion in bonds over a three month period when it was officially reducing or tapering the quantitative easing down to $65 billion.  It didn’t want to have to admit it was really purchasing $112 billion a month, almost double the announced purchases.” 

Dr. Roberts also says, “I think also the Fed did not want it to get out that some large country is unloading Treasuries.  Somebody dropped over $100 billion in Treasuries in one week.  If that was a large holder and that became known, it could panic smaller holders and you could see a stampede, and the Fed could lose control of interest rates.  So, I think the Fed thought the best thing to do is launder its purchase through a different country; and, thereby, disguise what is actually happening.” 

Why is the Fed worrying about the shell game of Treasury purchases?  Dr. Roberts says, “I think there wasn’t any buyer for the $104 billion in one week.  So, if that kind of bond sale sat unattended, interest rates would rise; and so, the Fed had to buy the bonds in order to protect its interest rate policy.  But, if it outright bought them and this was known, then it starts to interfere with the ‘tapering’ that it promised to do because all of a sudden it’s not ‘tapering,’ at least not for those three months.  It signals somebody is unloading Treasuries, and that could stampede others.  What it indicates is they are not feeling all that confident that the dollar is on such a sound footing, or the U.S. financial system is on all that much sound footing that they can openly step in and take up that type of purchase.” 

On the steep drop in GDP growth of a paltry .1% in the first quarter, Dr. Roberts says, “What I find most amusing about this is they had to claim some real growth in the first quarter; so, they eked out .1%.  Now we know they got that by rigging the inflation number they used to deflate the gross domestic product (GDP).  The real GDP in the first quarter, properly deflated, was negative and probably also in the fourth quarter.  Most likely, this coming quarter, they are not going to be able to hide the fact that it is negative. . . . I am convinced the first quarter was negative, and I don’t see how it could possibly go positive in the second quarter.” 

On Fed Head Janet Yellen’s rosy outlook on the economy, Dr. Roberts debates, “I don’t see how she can see that the economy is going to start growing.  What is going to make it grow?  Why should investors invest money when consumers don’t have any money?  There are not retail sales.  I think it is just part of the rah, rah talk.  Everywhere else in the world is going down the tube.  So, what’s going to push the American economy up?–Nothing that I know of.” 

On the Ukraine crisis, Dr. Roberts says, “I think Washington badly miscalculated this whole Ukraine business.  It was an act of hubris, arrogance and stupidity.  They are mad at Russia for blocking their attack on Syria and blocking their attack on Iran. They said ‘we’ll teach them.’  We’ll give them trouble in their own backyard and not to get in our way anymore.”  The threat of sanctions has made the Russians realize the dollar system is not in their interest, and they are going to leave it. . . . If any significant part of the world stops using the dollar, the price of the dollar falls because demand for dollars falls, and the import cost for America would rise.  When you see how import dependent we are, it would mean a substantial rise in the real cost of living for most Americans.”  

Join Greg Hunter as he goes One-on-One with Dr. Paul Craig Roberts. 

(There is much more in the video interview.) 

After the interview:   
To make a tax deductible donation to help support Dr. Paul Craig Roberts’ work, please click here.  (Please note there is also a snail mail option on the right side of this page.)  To buy or download a copy of Dr. Roberts recent book titled “How America Was Lost,” please click here.   

Comments
  1. Justin King

    Considering that PCR is now well known on the internet news cycle, this Belgium story will have to be picked-up by someone in the mainstream media, right ?
    RIGHT ?????

  2. armando

    Greg, as someone with an extensive background in both Economics and Geopolitics (recently retired US Naval Officer with a Masters in Economics), I found myself captivated by this superb interview – your fine work truly stands out from the rest! Taking into account that Dr Roberts is a former Assistant US Treasury Secretary (and the father of Reaganomics), this gentleman is probably the most credible individual speaking out on the true state of the US Economy and Geopolitical situation. It seems incredible that the information he provides isn´t on the front page of every newspaper & the top story in every financial news show, the Main Street Media is obviously completely controled by the Government & Wall Street. I can only hope that his message wakes up more people before ¨the wall comes tumbling down¨ or before one of our three-letter agencies decides that his message is too ¨dangerous¨ to permit.

    • Greg Hunter

      Thank you Armando. I hope people wake up too my friend.
      Greg

      • armando

        Greg: I´m not sure what your operation and financial situation are like – but I worry about the safety of people like Dr Roberts and those who put out his message like yourself. While I realize that our bankster-controlled government may drag this out for longer than I believe possible, I cant help but wonder if it will be safe to be at ¨ground zero¨ when the reset takes place. I´ve chosen to reside in safer jurisdictions and have permanently relocated my family overseas. I now enjoy freedom and economic benefits similiar to what we had in the USA in the 1950´s. If it´s a possibility please consider it – and that goes for all freedom lovers.

        • TexasAZ

          I’m curious..Where did you relocate to?

        • wd

          Armando,

          Congrats on that decison. I believe a lot more people will be doing that and I believe they are doing that ( we just don’t get accurate numbers). I am torn between staying here and making that life change. I wish I could ask you but I understand theend for anonymity. I have three countries I am looking at moving to, but its just not in the stars yet. Good luck!!

        • Rickey

          Aramdo; what country did you find that freedom in I know several people looking for a place to relocate to, however there always seems to be an issue with their prospective new home.

        • armando

          After 22 years in the military 8stationed overseas for much of that time) – I realized that the ¨Land of the Free¨ line we´ve been sold is now little more than propaganda. While the US has historically provided many financial advantages and ¨liberties¨ not easily available in most other countries – sadly, times have changed. In fact I generally feel much more ¨Free¨ in almost any other country and I certainly spend alot less to live comfortably. The country I´ve chosen is not necesarily the ideal place for everyone, since there are many factors to consider (such as your particular economic situation and your willingness to adapt to another culture/language). I personally like Central and South America but Southern Europe, Southeast Asia and possibly Australia or New Zealand may be more suitable options for some.

          Minimum monthly income (for a family of 4):
          $1,000-$1,200 – Ecuador, Philipines
          $1,200-$1,500 – Panama, Belize, Mexico, Thailand
          $1,500-$2,000 – Dominican Republic, Spain, Portugal
          $2,000-$2,500 – Chile, Costa Rica, Italy
          $3,000-$4,000 – Australia, New Zealand, Switzerland
          (Belize, Australia and New Zealand are English speaking)

      • nikunj

        I think somewhere Media is not showing correct picture of US inside shadow economy… how can Belgium can buy FED bonds?
        If true information will not come out now then in future common people hhave to face issue.

    • Sadeus MaConnell a r m a n a d o

      The dumbing down of the American populace since the Clinton administration has truly been accomplished. The only hopes and dream’s of the present American administration (dopes), are, Pipe dreams, due to the administrations quest for the legalizations of Marijuana (dope) and the elimination of any drug law enforcement, plus the release of all drug related criminals from prison and any stigma of criminality, from their, records. Put that in your pipes and smoke it, because you toked away any hope, you dopes!
      P.S. To bad Bill didn’t inhale, we might have some hope, because he never would have made it, to president and the maimstreem media wouldn’t have as their only concern today, wither Monica swallowed or not. L O L, Vanity Affair!

  3. Colin - 'the farmer from NZ'

    Hi Greg
    It is always a treat for me to hear PCR’s words of wisdom.
    It would seem to me that if the Fed has to launder bond buying through Belgium to hide the fact that there are a whole lot of bonds coming onto the market that no-one wants, then things are indeed getting pretty desperate. It would be very interesting to know which countries dumped $100b in treasuries in just one week.
    I wonder what country will “buy” the next $100b “worth” and the $2 trillion worth after that!
    Cheers
    Col

    • chris m.

      As I understand it from a Zerohedge blog it was Russia that unloaded their Treasuries.

  4. Kevin

    “Even the grandest of Dog and Pony shows are nothing more than a simple distraction to what really matters” (Nivek)

  5. art barnes

    Greg, if we know the Belgium bought the bonds why don’t we know who dumped and or sold the 100 billion in bonds? Did the FED have to make a deal and pay the Belgium’s to do this purchase and or play along if you will since the premise is that the “deal” wasn’t on the up and up? Is the FED ever subject to having to reveal such “deals”? Since I don’t have a Doctorate in economics your guest raises these questions in my mind and maybe others. Thanks, a.b. PS, Love Dr. Roberts chuckel(s).

  6. Joe Gee

    Good day Greg, Great interview with Dr. Paul Roberts ! I just sent Dr. Paul Roberts a donation….Greg, God bless you and your work…..Joe Gee….

  7. Jerry

    Greg
    I have been saying for the past several months that the Chinese are going to collapse the dollar.

    PCR ( Perfectly Credible Rock star) pretty much puts this in focus when he talked about the Belgium Bond buying scheme. The reason why the Fed was forced to buy bonds and hide them in Belgium , is because no one else wants them. If that isn’t a statement about the confidence in the dollar, I don’t know what is. Forget about the taper talk. Its all lies. Like PCR said, its more like 125 Billion a month instead of the reported 65 Billion.

    Greg, here’s the real kicker. According to my sources, most of the central banks are ready to convert to a new Gold backed Yuan system. In fact I have heard that they have gone as far as a trial run to make sure all their computer systems mesh together in the new network. This is not a new development. The Chinese have had a team of engineers working on this project for at least four years. This upcoming meeting with the Russians is not for show, its is to implement the first phase of this new exchange system. And just remember, the Russians made a deal with the Iranians for cheap oil, so I expect a move on the petrodollar soon, as well. Brace yourself Greg.

    • Greg Hunter

      Jerry,
      I am braced but nobody will be totally ready for what is coming.
      Greg

    • wd

      Jerry,

      Good point! The upcoming news caption should read:

      FOLLOW YELLOW(GOLDEN) “BRICS” ROAD. The BRICS have back.

      1) Gold backed currency
      2) Manufacturing
      3) Strong commodities market
      4) Fundametally sound econ direction.

      This is why US wants to escalate war in Ukraine. Desperation!

      • Jerry

        Good one WD.

      • Galaxy 500

        While I can see international transactions settled in gold, I dont see the evil bankers and their govt lackeys allowing the population this privilege. They give up too much power. It will take second American Revolution to retake the power from the bankers and we would have to be careful about who the leaders are as they may set up their own fiefdom.
        Via the Second Revolution…

    • Sadeus MaConnell________J e r r y,

      What’s to happen to Janet Yellen?
      All the men at the Fed have jumped ship. . . Greenspam. . . Bernake- attack Ben, ect. . .
      Poor Janet will be left holding the bag and the blame, as captain, at the helm, of the sinking, USS Titanic, to go down with this sad, ship of fools! R. I. P.__~

      • Colin - 'the farmer from NZ'

        SM
        YES – well if Janet Yellen had half a brain she would have known what she was taking on from Ben B. I have no sympathy for her whatsoever. I remember the stupid/delighted expression she had on her face during the ridiculous bullshite Obama speech at the handing over ceremony. I also remember helicopter Ben’s body language too – he looked like a pathetic cornered rat that couldn’t wait to get out of the room.

        • Peter Jaxon

          Yellen isn’t under any illusions, she has a part to play and she’ll play it. You do know that the current war criminal in chief doesn’t just make up a list and then decide. The NY Fed gives him a ‘list’ (could have just one name for all we know), and he picks from that. And probably needs to consult his teleprompter for the answer.

  8. josh

    great interview greg. i just wish dr. roberts wouldn’t laugh so much while he’s delivering his analysis. it’s not funny, it’s tragic!

    • mark

      Hi Josh,
      Just consider that it is not just anyone laughing as they deliver such a tragic message– it is the former assistant Treasury Secretary under the Reagan administration– the father of Reagonomics. He surely knows beyond many of us just how tragic it is and his laughter only serves to highlight the utter absurdity of the policies (fraud) our so-called political and economic experts are trying to pawn off on the generally dumb public. Very sad indeed and I believe he is deeply aware of how tragic the situation actually is.

    • Galaxy 500

      Dude
      if he wasn’t laughing he’d be crying. We are witnessing the death of freedom and liberty while we sit and send cute little messages … we should all be laughing and crying hysterically

  9. Diane Ryan

    Awesome interview. Talk about the ‘ring of truth’, Dr. Roberts’ has it. USAWatchdog is making an absolute mockery of the MSM.

    Payback will be hell for the globalist-controlled federal government with their MSM and military mercenaries if you believe in Proverbs 6:16-17, ‘Those Things doth the Lord hate: A proud Look, a lying Tongue, and Hands that shed innocent Blood.’

    • Sadeus MaConnell________J osh,

      Maybe he just wants to keep his sanity!

  10. Oregon Patriot

    Wow! Greg, our country left the “crazy zone” some time ago and we are now smack dab in the middle of the “are you frigging kidding me?” zone! I so much appreciate your site and the increasingly insightful guests you have. I keep hoping I will wake up to hear this was all a bad dream, but me thinks this is not going to end well for any of us, informed or not. I do want to sincerely thank you though for your work. Without your site and many more I read, I would still be one of the clueless sheeple I see every day happily going about their business like nothing is amiss.

    God help us all.

  11. Galaxy 500

    Greg
    Its a fact that is hard to ignore: the Fed is money laundering to hide the source of purchases. But the real question we should be asking is, “Who are they hiding it from?” Any G20 nation would know what is going on, so wouldn’t that leave the only answer to be the American public…which wouldn’t know even if it was published in the Wall Street Journal. The low information voter is what is destroying this country.

    • lastmanstanding

      500. LOOK at most of the American public. They live a life they have absolutely NO appreciation for. Everything in their life is a fairy tale. They are nothing but mindless drones created to consume the corps next wet dream.

      God and the earth that he created do not work that way. Best wishes brother.

      • Galaxy 500

        LMS
        I am outraged these days. I come in constant contact with people that have an unsettling amount of entitlement. Its unnerving to see someone complain they have to pay $3 for a $1,200 prescription. You see before they were a “child” under Medicaid so her prescriptions were free and now that she has aged out she has to pay $3 but dont worry her 3 children are covered for free care…and she seemed to be doing well…she had money for smokes and was driving a new model SUV while I drive a fifteen year old van. Sure I could drive a new car but its not on the top of my list, my wife drives more and she drives the newer model. And before I get called out as a racist, this kid is white or appears so…dont really know her pedigree but when she asked if her kids were still covered I think “poor white trash” when thru my mind but I cant help my upbringing…nor would I want to change. Its this mentality, this entitlement mentality, that is destroying our country.
        Why work when you can get more for free than what your broke ass lame skill set will earn? Hell, she appears barely literate so I guess while she should have been studying she was to busy being knocked up. And all the children had different last names and she struggled with their birthrates while they we checking to see if they were in the system. Seems like I spend my life in line listening to people have conversations in public that should have been embarrassing and caused shame…these people are without shame

        • lastmanstanding

          My wife is in the medical biz…I could tell you 100’s of Medicaid stories that would piss you off like the one you just mentioned. Now people come in and they have “INSURANCE”!!!

          She asks, what plan? What do you mean, they ask? Well, gold, silver , bronze…you picked a plan…Well I have bronze. (proudly!) Well then you have a $5500 deductible.

          So…what does that mean? It means that you have to pay The first $5500 out of your pocket before your “INSURANCE” will cover any of your expenses.

          “WHAT!!! I DON’T HAVE $5500 DOLLARS…WTF!!!
          There is more…but you already know it.

          What they heard, in their own mind, was free insurance.

          As I roll thru my beautiful little community here in Big Sky country everyday, life appears good. We are busy because we have worked tirelessly to be productive, offer top quality services to our customers and are fully honest with them and ourselves.

          As business owners, we see things far differently than those who are employees. Employees have NO clue.
          Our gub hates small biz…they want us to give up and become one of the drones.

          As Arnie said in one of his movies…”No chance.”

          No way they (gub, corps, satan) will beat us…God and his beautiful earth are welcome to try…it has happened before.
          I hope that he respects our efforts to stay and continue.

          I am planting the rest of my garden today…it is sunny and beautiful…my fruit trees are blooming our health is good.

          There are many of us out there that will be the “lastmanstanding.” (women also!!!) Regardless of the odds, based on what I see, there is no way that satan and his bastards will win…”no chance”.

          • Greg Hunter

            Lastman,
            Good real world info!! Thank you for posting it.
            Greg

          • Galaxy 500

            My wife is in the healthcare industry too. Good luck to both of us and the good women that put up with us ;-)

  12. Oracle 911

    Hi Greg
    Paraphrasing a running joke:
    Chinese government is faking the GDP growth, the US government is faking the entire economy.
    Japan is on verge of collapse.
    How close is the end of US$?
    Few months, maybe half a year.

    • Sadeus MaConnell________G500,

      Well once again we can only thank our fearlice, lousy, leaders, for the sad State of the Union. . . .”Yes sir my friends, the meek can only inherit the earth when the john Doe’s start lovin their neighbors! You better start right now, don’t wait till the game is called out on account of darkness. Wake up John Doe, your the hope of the world!” Long John Willoughby, {John Doe}.
      http://www.youtube.com/watch?v=9jOf8GD4S7E

      • Galaxy 500

        Love my fellow man??? Haha haha
        I am doing go to merely tolerate them

  13. Michael

    We put satellites in orbit every day. They can only prevent heavy lift and INTERNATIONAL SPACE STATION access because of the mating requirements.

    • Plain old Dave

      Really?? The govt puts satellites in orbit every day? Would you happen to have a link to verify that…I can’t seem to find one.

      • Khiori

        We launch satellites from many places in the country, for example Wallops Island. NASA launches satellites, and they launch out west. It does not require such a huge rocket. http://www.nasa.gov/centers/wallops/home/ Here is a link to Wallops.

      • Galaxy 500

        I think everyday is a slight exaggeration but we do launch regularly.

  14. Firth of Forth

    An appropriate clip to accompany Dr. Roberts

    http://www.youtube.com/watch?v=VMHLrqKTOfA

  15. Matthew Schimpf

    Another masterpiece of an interview, well done. I could never begin to argue the merits of Dr. Roberts assertions, he’s forgotten more about economic theory and practice than I’ll ever learn. When you asked him for a time frame relative to an inflection point, Paul was quick to point out that he’s surprised that the charade has gone on as long as it has, which begs the question: What is he (and the rest of us) not seeing? What other antics are up the exceedingly long arm of those confidence men/women known as “The Federal Reserve?” I realize that as Dr. Roberts contends, they (the con men) are full of hubris and avarice, but are they really that dull? What could possibly be their end-game? Inquiring minds want to know……

    • Greg Hunter

      Matthew,
      You are too kind thank you. When you have a star like Dr. Roberts anyone can look good!
      Greg

    • Jerry

      Matt
      See my coment below. This is one of the best ponzi schemes ever devised, soon to go into the dustbin of history.

  16. Jerry

    Banking scam revealed.

    In light of PCR information, ask yourselves: How do the banksters maintain an absurd USDX number? How do they keep demand up for T-bills? If you look hard enough, the devil in this detail is none other than the $400 trillion interest rate (IR) derivative swap market! Interest rate swaps create artificial demand for US Dollars and US Treasuries. The FED prints the money, which in turn, is used to purchase the T-bonds that are high as a result of demand caused by IR swaps. POOF!! The USDX stays high, demand for T-bonds is created, and wash and rinse, and repeat. (Quote from V)

    Who among us thinks the Chinese are stupid enough to continue to be bilked in this system. Certainly not me.

    • Plain old Dave

      China sold the second largest amount ever of US T-bills in December 2013. This was the second largest dump by China in history with the sole exception of December 2011.
      And Guess Who Comes To The Rescue….yep Belgium…the country that has no money…no resources and no way to get the funding.
      Chinese Treasury holdings plunged by the most in two years, after China offloaded some $48 billion in paper, bringing its total to only $1268.9 billion, down from $1316.7 billion, and back to a level last seen in March 2013.

      That’s right: at a time when America’s two largest foreign creditors, China and Japan, went on a buyers strike, the entity that came to the US rescue was Belgium. Yep nothing to see here….walk away.

    • woody188

      The Henry Paulson legacy strikes again!

      At least now I know why they didn’t take down the derivatives market when the crash occurred in 2008. The government is complicit in the scheme!

  17. Chip

    Great interview Greg. Love PCR… Chip

  18. John Roberts (UK)

    If the US Federal Reserve is trying to hide what it’s doing then it isn’t doing a very good job is all I can say. If PCR can uncover this then the major emerging market players China, Russia and India can too and one can only guess at what is going through their minds. Their response to all this manipulation (the creation of a de facto international reserve currency based on the value of a basket of currencies and implicitly backed by gold) does not bode well for the economic prospects of the USA and it looks increasingly likely that we may see a ‘collapse of capitalism’ barely two decades after the ‘collapse of communism’. I wonder what Francis Fukuyama would say to that.

  19. Woodrow

    “So, I think the Fed thought the best thing to do is launder its purchase through a different country” –

    Thinking is great, proving is an entirely different matter. While not discounting that The Fed and our own government don’t mind engaging in criminal behavior, if you’re going to make such a claim, as it appears here, can you prove it?

    • Plain old Dave

      Woodrow,
      Perhaps you can explain how Belgium bought $141 billion worth of bonds over a three month period. A sum that comes to 29% of the Belgium GDP. They don’t have a surplus in their budget and that amount is 29% of their GDP. They don’t have trade or current account surplus in that amount. In fact, everything is in the red. They are not allowed to print currency as we are because they are tied to the Euro. If they didn’t have the money, and yet, they managed to pick up $141.2 billion in U.S. Treasuries over a three month period one would think the obvious, we gave them the money they certainly wouldn’t buy them as an “investment in the faith and good credit” of Amerika. . I’m open minded. Any answers as to how Belgium pulled this off without our money?

      • allen ols

        plain dave

        Europe is the grand prize. And it’s always been the grand prize. Well, due to NATO and World War II considerations, the United States is pretty much captured, colonized, integrated Europe.
        That’s about to change.
        I think Europe is going to turn its attention eastward.
        They have a parade of gold-backed currencies coming. It’s not just going to be the Russian Ruble or the Chinese Yuan. It will involve the Gulf Dinar, with the Saudis. I think it will involve the Nordic Euro.
        The Germans, with their friends the Dutch, the Austrians and the Finns, Finland…
        They’re all ready. They’re just waiting for the moment. They’ve got a Nordic Euro, and they’ve got plans for gold backing.
        From Sprott Money:

        http://www.silverdoctors.com/jim-willie-germany-preparing-gold-backed-nordic-euro/

        • Galaxy 500

          Where are they getting their (German) gold? They dont have much on hand as a large % of their gold is stored abroad. ..and we ain’t giving it back. We’re holding it as collateral for the bar tab the Nazis ran up

    • Jerry

      Woodrow
      Proof is in the pudding. Don’t eat to much
      http://blogs.marketwatch.com/thetell/2014/04/15/belgium-is-buying-up-tons-of-u-s-treasurys/

      • woodrow

        To both – Neither of you provided proof.

        http://www.federalreserve.gov/releases/h41/Current/

        It’s not there. So again, what Roberts and some of the rest are saying is that The Fed committed a criminal act. All I’m asking is to use the current standard – “beyond a reasonable doubt” – that proof of a crime was committed. If any of you, including the author can PROVE it, I’ll be the first one to pick up the phone and call the authorities, including my CONgress Members.

        • Jerry

          Are you kidding me? Are you dumb enough to believe a statistical report released by the Federal Reserve? O.K. you believe in the rule of law right? How about we open them up for an independent audit? It’ll never happen.

  20. EaGou

    This is a great post. Has recent the easing of FATCA got anything to do with Russia abandoning us dollar ?

  21. Max

    Greg –
    Thanks again for having Dr. Paul Craig Roberts on.
    That was a quality interview.

    • Greg Hunter

      Thanks Max.
      Greg

  22. nm

    Forgive my ignorance, but I have a few questions about how the Fed works because it’s never quite made sense to me:

    1) If the fed can just create money out of thin air, why go through the process of buying and selling bonds? Why not just create the money and give it to whomever? Why are other countries even buying these bonds? Is it because they need the dollars to pay for oil or what?

    2) Why will interest rates raise if countries don’t buy these bonds? I suppose I don’t get the connection between what the fed and the banks are doing (both domestic and foreign are doing)

    3) Somebody dropped over $100 billion in Treasuries in one week – who? Was it a country?

    4) Why doesn’t the fed just get out of the way and let human beings do what they’ve been doing for centuries? ie produce goods and trade them with whomever they want? Isn’t that economics summed up in one sentence?

    • mark

      Hi nm,
      If you go to http://www.hiddensecretsofmoney.com you will find a very well done series of short video documentaries by Mike Maloney that I believe provide a useful easy to understand explanation of the development of our current monetary scheme from its inception to its present day state.

    • aw

      Simply printing the hard money to pay the bills would be more inflationary. Most money does not even exist and only exists as entries on computers or amounts written on bank statements. Only base money (paper money mostly) actually exists. By having a functioning bond market/system the money gets recycled so running deficits is not as inflationary. The bond market is breaking down/clinically dead so now the FED has to create new base money in order to buy the bonds, prop up the bond market and keep interest rates low.

  23. art barnes

    Greg, if Dr. Roberts is right about 100b being dumped in one week and the FED buying it back through little on Belgium, then in that event, its the eight inning and the score is Yuan 8, Dollar as reserve currency 4. However, up to bat in the bottom of the ninth is the FED & the American government’s heart of the lineup; WAR.

  24. smaulgld

    A most excellent interview. My view is that the US will use its military power to force Europe to buy US treasuries in exchange for continued NATO support.
    The Fed needs someone to buy the bonds that they say they are not going to buy anymore. China and Russia are no longer buying, so who will buy the bonds? My guess is the US will lean heavily on Europe. http://smaulgld.com/euro-dollar-way/

    • Bubbabear

      @Smaulgld
      …..when the fed fully tapers they can’t have any more shady deals because only they can dump that amount of credit for Belgium to shadow buy ……So as they taper dance, they can inject credit. Once they fully taper, no room to hide their credit inject unless they find like 50 more countries as shadow buyers

      • smaulgld

        You would think that might be the case but they seem to get away with whatever they want. Reuters picked up on the Belgium story and seemed to brush it aside. The US can taper to zero and just keep printing and funneling the money to Belgium and to whomever they strong arm to act for them, or they can make them purchase tbonds with their own printed reserves!

  25. libertarian jerry

    The question to ask is; What happens to the Political Class when the dollar collapses and the hyperinflation monster rears its ugly head? Judging by foreign countries that went bankrupt, I have read that the Political Class (welfare recipients,people on unemployment,government employees,retired government employees etc.) go into the streets to demonstrate,riot and cause all kinds of mayhem. Could this happen in America? Or will the Political Class realize that the government gravy train is permanently broken and they will have to go into the great American free enterprise system and find a real job. No more guaranteed jobs,guaranteed cost of living adjustments,health insurance for life.retirement at 50 or 55, paid vacations etc. Maybe the dollar collapse will be the cure that America needs to shake people up into being self reliant. Or maybe, America will turn into a complete police state that will make the lives of all productive Americans a living hell. Whatever happens we will certainly be living in interesting times.

    • Bubbabear

      ….. when the fed fully tapers they can’t have any more shady deals because only they can dump that amount of credit for Belgium to shadow buy ……So as they taper dance, they can inject credit. Once they fully taper, no room to hide their credit inject unless they find like 50 more countries as shadow buyers

    • julian reczek

      Hi When people go In to the streets as you say in other countries they are unarmed.They have few weapons.But america has over 200million guns in the hands of the people .Thats the major problem for America.Potential civil war again.If people feel they have been lied to and robbed of their future they always enact civil disobedience

  26. mijj

    solution for the USA .. purge the political/economic system of the Mafia mindset.

    This isn’t about particular political parties or individuals. The whole rotten political/economic power system is infested with the Mafia mindset. In the Mafia mindset, wealth isn’t created, it’s taken from someone else. Which means, when theft becomes more and more difficult (under the guise of spreading “democracy”), there’s economic collapse.

    But the collapse isn’t evenly spread, of course. The less political/economic influence you have, the more you’ll feel the effect. Therefore there will be an increase in the rate at which power and wealth is accumulated at the “top”. All reinforced by an increase in the power and aggression of the police state.

    /pure conjecture

  27. Darren

    Hi Greg, great site, gives great insight to what is currently happening both in the USA and the rest of the world. I am located in Australia

    In regards to the $1oob dumping of US treasury bonds, I read somewhere it was Japan. Cannot verify this as fact though unfortunately.

  28. 8Ball

    As always, a great interview with PCR. He is a smart and measured man, he stops short of making a definite “collapse” prediction or timeline and admits that all of the current monetary nonsense has continued on much longer than he imagined that it ever would.

    The whole premise of the FED / USG monetary theory and policy is flawed in that it is impossible to borrow money that you do not have indefinitely… Smoke & Mirrors but they have kept the charade going for about 100 years now and the game is about over for this run on people’s money. They are now printing money to pay the interest on previously printed money… Ouroboros lives.

    They are now busy formulating a plan for the next big monetary bamboozle that they will implement… if they can.

  29. Jerry

    My last post of the week Greg. If you enjoyed Paul Craig Roberts comments as much as I do, then you’ll probably want to see this.

    http://www.nationofchange.org/132-nations-want-out-cabal-banking-system-1399298516

    I think the cat is out of the bag. Everyone but the Cabal brainwashed masses know about it. Time is of the essence.

    • Galaxy 500

      Most of the numbered points are basic anti-fraud and loss prevention run by lenders. Heaven forbid a lender judge a diplomat on whether they will be repaid. Is it somehow wrong for a lender to scan transactions to prevent fraud and to check a person’s credit history proactively to prevent losses?

  30. Dwain

    Greg,
    great interview.
    Years ago in real estate, I saw desperate sellers attempt to provide capital to buyers in order to make the sale work. It appears the Fed is doing something similar here. Of course both are illegal.

    • Dwain

      We are all welfare recipients now. According to BLS stats for Jan 2014, there are a total of 137 million US Jobs. Out of those, 21 million are in healthcare (disease/plunder/debt), government: 22 million (plunder/debt), Education: 21 million (debt/plunder/indoctrination).

      Retail (oppression), leisure and hospitality (hedonics) make up another 30 million. Law, based on corruption, insurance (plunder), finance, primarily based on above, make up 13 million.
      Total: 107 million “jobs”

      Manufacturing is only 8.9% of total jobs.

      Our economy is upside down and only continues because of the toilet paper dollars reserve currency status. Maintaining it is what unwarranted murderous US wars are all about.

      Great crowned dragons spew over all creation preparing ash heaps for consumption. Clouding the heavens, offspring scour the earth, dive bombing fleshy cinders.

  31. Jeff

    This discussion dovetails nicely from the last one. Mainly being the US debt is beyond payment. We are making interest payments with a credit card and the debt keeps mounting……The day the Fed announced their so called “taper” I laughed. I laughed because there is no way they can not purchase our debt without a resultant rise in rates. It is that very purchasing of debt that keeps our rates low…….If rates rise the interest will be unbearable. Therefore the proverbial catch 22……This is not the first time the Fed has utilized “indirect buyers” to hide said purchases. It’s just the most blatant, in your face attempt. Which should tell you they have fewer choices and are becoming desperate….. The rest of the world sees this but sadly our own sheeple (citizens?) are asleep . You can credit that to the MSM who have done their job….. That said, it is out of our hands and preparing for the inevitable is our only choice.

  32. Palloy

    Who sold the $104 billion in bonds?
    Since the dump occurred in Nov-Jan, and that was when the anti-Yanukovitch riots were happening in Kiev, and Russia started accelerating the technical moves away from the USD, I should have thought the answer was obvious – it was Russia, perhaps helped by China. Who else could it be?
    Why doesn’t even PCR say it, when it seems so obvious ? ZeroHedge is still stuck on asking the question about who was behind Belgium’s purchase. OK so proof is lacking, but surely someone somewhere can reason it out.
    It seems like Russia-China will have to implement its own version of SWIFT to facilitate USD-free international banking payments. This shouldn’t be so hard – Russia had one before, which was abandonned when SWIFT became popular, and SWIFT is ISO standards-based, so with their computer expertise it should be straightforward.
    Who will want to be holding USTs when Rossiya-SWIFT starts up?

    Could we PLEASE have some of these questions answered, Greg?

  33. Tilo

    I have read yesterday that Russia is actually preparing to sell energy in Rubels ONLY(unfortunatly I lost that link). So much for sanctions.

  34. Geo. T (formerly George)

    Greg,
    Can you guess why the USDA need automatic weapons? Its to keep the mutant corn in line.
    http://www.breitbart.com/Big-Government/2014/05/14/Dept-Of-Agriculture-Orders-Submachine-Guns-With-30-Round-Magazines
    Here are the bid details (not an exact copy as I corrected many spelling errors), notice that its 40Cal:
    Solicitation Number:
    USDAOIGWEA-5-7-14 Notice Type:
    Sources Sought
    Synopsis:
    Added: May 07, 2014 2:03 pm
    The U.S. Department of Agriculture, Office of Inspector General, located in Washington, DC, pursuant to the authority of FAR Part 13, has a requirement for the commercial acquisition of submachine guns, .40 Cal. S&W, ambidextrous safety, semi-automatic or 2 shot burst trigger group, Tritium night sights for front and rear, rails for attachment of flashlight (front under fore grip) and scope (top rear), stock-collapsible or folding, magazine – 30 rd. capacity, sling, light weight, and oversized trigger guard for gloved operation. NO SOLICITATION DOCUMENT EXISTS. All responsible and/or interested sources may submit their company name, point of contact, and telephone. If received timely, shall be considered by the agency for contact to determine weapon suitability

    So fellow readers, do you think the DHS is going to share their 40Cal ammo so USDA can come and steal the farmers’ crops and shot the farmers when they object to the theft? Under what real world circumstances does the USDA need automatic weapons? Easy answer, THERE ISN’T ANY!

    • Galaxy 500

      Dude
      it isnt the corn, USDA needs gun to keep those mad cows inline

  35. Rezo

    Hi Greg, I am an Aussie and new to this site, but Have been following PCR for a while.I do alot of researc and I believe he is 100% correct. I question though his comment on a NATO military build up on Russias neighbours soil.Russia will never allow this .It simply doesnt have to. And why should it? Can you imagine American soldiers fighting in -40 degree temperatures. The cost of keeping them cool in Afghanistan was astronomical. And lets not forget Russia has been modernising its military for a long time now, including its neuclear weapons. It is a superpower not a small African country.It will NEVER BACK Down.

  36. Randal

    I have been a fan of Paul Craig Roberts for some time. I appreciate his perspective, and the information he provides. However, I have nagging suspicions about his role. He has to know things about the inner workings of the Treasury and the Federal Reserve that he’s not telling us. For instance, in this interview, it appears PCR is speaking from his basement den. Note the two flags. On the left is the gold-fringed Admiralty/military/corporate flag of the U.S.. Why is that? And what is the other flag? I don’t recognize it. I do know, however, that Deputy, Assistant, and Under Secretaries of the Treasury have their own flags. What’s up with that? Government symbolism is very important, and carefully planned. Someone needs to ask PCR to explain the flags he flies, and then question his answers.

    • Greg Hunter

      Randal,
      Oh please. Dr. Roberts is making no friends with our leaders by what he is putting out. You are analyzing the flags in the background? Really? Enough.
      Greg

    • Galaxy 500

      All the problems in the world and all the bull Shiite your are being fed by the MSM …
      And these are the questions you come up with? Dude, really???

  37. Calgirl

    “Well, if the west wanted Russia’s response to ever escalating sanctions against the country, it is about to get it.”

    “the further the west antagonizes Russia, and the more economic sanctions it lobs at it, the more Russia will be forced away from a USD-denominated trading system and into one which faces China and India. Which is why next week’s announcement, as groundbreaking as it most certainly will be, is just the beginning.”

    http://www.zerohedge.com/news/2014-05-13/russia-holds-de-dollarization-meeting-china-iran-willing-drop-usd-bilateral-trade

  38. zino

    Hi Greg

    Great interview
    I really like watching Dr Paul Craig Roberts. He is great public intellectuals and the wisest man in the American politics.
    Thanks for the card you sent. I got it few days ago :-)

  39. Greg Hunter

    Supreme Allied Commander,
    You do realize that Dr. Roberts left the Reagan Administration nearly 30 years ago. He has a PhD in economics and is a former Assistant Treasury Secretary. Am I supposed to find out what is going on from people like you? What are your credentials? And what is your real name. People like you can talk very big, and might I add stupid, when you are an anonymous participant.
    Greg

    • supreme allied commander

      You know my real name don’t you Greg, From my email: Cody.Martin.1@us.af.mil You call me stupid for the comment I made about PCR? the comments I make come out of raw experience with the power structure/model of the military obedience that is identical to top government officials. Well, every single time I say something about PCR one of the other commenters gets flustered and says “PCR has a PHD and was the ASST SECRETARY OF THE TREASURY under Reagan! Why does that impress you so much? Are all of you impressed with the current Asst. secretary of the treasury also? you think PCR would be any different than current Asst. secretary to the treasury if he still held the title? Don’t you know that this country has been a kangaroo country since the FED banks creation? My “credentials” are just 12 years in the air force in eight different country’s. Well I apologize for giving you Greg the notion I am stupid because of my intuition about PCR. I honestly never would have guessed you’d stoop as low as some of the commenters here. I am a pretty good judge of when someone’s not who they present while on camera. Trust me on this Greg the majority people in positions like that not are interested defending the constitution, please prove me wrong about PCR, I wont take offence to being proven wrong. Reagans admin was very dirty and I think PCR is guilty by association because I have no doubt he knew at the time it was filthy and rotten behind closed doors and didn’t care. Now that I am not anonymous does that give any credence to my comments?

      • Greg Hunter

        SAC,
        I should not have used the word “stupid.” I am sorry. I simply should have said I disagree with your comment. I know for a fact Dr. Roberts is a outcast from his former “friends.” In the upper echelons of power. I am not only impressed with Dr. Roberts knowledge and access to the inter-workings of government at very high levels, but his willingness to tell the world what he thinks is really going on behind the scenes.
        Greg

      • Galaxy 500

        The Fed seemed to work well under Reagan…they helped facilitate a recovery with shared pain due to 15%+ interest rates, even for govt.
        This is in contrast to the current Fed policy of manipulation of interest rates to maintain artificial low rates to keep the govt from undeniable insolvency as opposed to a covert insolvency. If the US and the rest of the world’s govt had to pay real interest rates, things would be dire for a while but we would then go into a real recovery. But it would hurt like Hell in the short term.

  40. Southern Patriot

    Excellent report Mr. Hunter. Thank you Dr. Roberts. Three Question’s! If we change course and gave pink slips to those politicians who are working so hard to destroy America in November, could we save our economy and our nation? Or is it to late? Surely, no one wants to live in a Communist/Marxist country. Or do they? Second question. Why are we not able to launch our own satellites into space? Is NASA dead? Question three. Is the total destruction of The United States Of America, what Obama had in mine when he took office? He is no idiot. They had a game plan when they came into office,they had there talking points and they had enough cash to buy anyone and anything. The ends justified the means.Thanks for letting me speak while Freedom still ring’s. Is anyone out there listening. For whom the bells toll….. SP

  41. `David E

    Thank you Greg. The volume is perfect now!

    Dr. Paul Craig Roberts is exceptional.

  42. Palloy

    I see Karl Denninger is saying that PCR is wrong ( http://market-ticker.org/akcs-www?post=229010 ) because the money doesn’t show up on the Fed’s books anywhere (particularly H41). Personally I wouldn’t have expected it to – yes, it would be illegal book-keeping, but isn’t that what money laundering is all about? Maybe it is on some other books, like any or all of the 12 regional reserve banks. Is it hair-splitting over whether it is The Fed or some other entity with the same motives?

    Can you ask PCR about this please?

  43. Felicia

    Greg, another great interview with Dr. Roberts! I really get alot from your questions and his answers. Here’s a link about something we all knew was is the works & now its official…Russia has a pipeline going to China. This a a huge turn of events: http://www.businessinsider.com/russia-scores-massive-gas-pipeline-deal-with-china-2014-5

    • Greg Hunter

      Felicia,
      thank you for adding this important dollar negative information. The dollar is collapsing before our eyes.
      Greg

      • Paul from Indiana

        Maybe so, but it will be a Pyrrhic victory. When the dollar is rendered useless, China’s primary market for its exports will evaporate. Europe will collapse. Times will certainly get rough here, no doubt. We are going to learn the hard way that we must live within our means. But the world’s economy will be trashed. No one gets out of this unscathed.

        • Galaxy 500

          Paul
          thanks for stating something I view as true but many people fail to add into their calculation.

  44. Jeff

    Directly from the Fed ….. ” The FOMC statement says that “even after employment and inflation are near mandate-consistent levels” the committee may keep “the target federal funds rate below levels” viewed as normal in the longer run……… in the “longer run” means forever or until the gig is up……. Palloy, not showing on the books is what is conveniently described as “sterilized”. Money created (remember that part) is loaned to the banks who turn around and buy treasuries. Because this new money is held from the economy it is considered non inflationary……. But it will eventually show up……This is not unlike the derivative argument that so many top economist consider safe. Derivatives are fine until they aren’t. When one counterparty can not perform the dominos begin to topple……I bring up derivatives because they are explicitly intertwined with interest rates. That being, they will topple together.

  45. Jeff

    Many in the MSM like Steve Liesman (CNBC) will tell you all this created money can just be re-absorbed back to the Fed. Anything is possible “in theory”. But like our discussion on interest rates, implementing the “theory” is near impossible in the real world…… We can’t afford higher rates. Newly created money is here to stay. Derivatives will be are ultimate enemy.

  46. skilaki

    I admit that my knowledge of economics is limited. When I hear discussions on Fed policy, tapering, treasuries, interest rates, etc…I really have no idea what that all means. All I know is that I must live within my means, that I cannot write checks that are larger than my bank account , and that a large credit card bill is bad. I keep hearing all this talk about “economic collapse”, “dollar collapse” and so on. My question is shouldn’t there be some form of economic collapse already occurring in states like California and Illinois? Also, if the dollar does collapse, what does that mean exactly for us? Prices skyrocket? Will it be like the Weimar Republic with people carrying dollars in wheelbarrows? Massive unemployment? Social chaos? I ask because I have this feeling that something bad (of epic proportions) is going to happen here, yet have no idea what form it will take.

    • Greg Hunter

      skilaki,
      The short answer to your last set of questions is all the above. As far as heavily indebted states, why do you think they have some of the strictest gun laws? I hope you don’t live in CA. Il. or NY.
      Greg

  47. Pat

    I love your site Greg and PCR is one of my favourite interviewees. I am not an economist and I have no financial training (I have to listen to most financial interviews at least twice to get it!) but I remember hearing or reading somewhere that it is the interest rate swap derivatives that actually control the interest rates on the bonds, not the money printing directly. Unfortunately I can’t remember who said this, because they went into it in some detail, and I myself have no idea why this is so! Just thought you might want to check that out – to explain how the interest rates can remain low even as the Fed ‘tapers’ (not).

    • Greg Hunter

      Pat,
      It is simply a way to flood the market with false demand. If I am wrong, please, somebody correct me.
      Greg

  48. Terra Tear

    “rise in the cost of living” What the good Dr. failed to say is hyperinflation… Our downfall as a nation is no accident. We know how this happened and why. Yet despite this knowledge and awareness, the downward trajectory of this country remains the same. All ‘they’ want is what everyone seems to want, which is a return to “business as usual” model of preeminence, privilege and excess and material consumption.

  49. Tom

    I think it was the IMF that paid for those bonds. They probably used SDRs. But does it really matter? both the IMF and the Fed take their marching orders from the BIS.

  50. mark

    This REALLY needs to get in the Mainstream Media. Why won’t Rush Limbaugh and Shawn Hannity mention any of Craig Robert’s findings. Hannity should have him on his show. It’s seams that Rush and Hannity are just playing into the hands of the corrupt……focusing on LEFT against RIGHT, just causing division….and not focusing on who’s at the TOP. Why can’t Paul Craig Roberts get on the Shawn Hannity Show?

    • Greg Hunter

      Mark,
      They all know this but they too are beholden to the banker criminals.
      Greg

    • Sadeus McConnel

      m a r k,___
      The same reason they try to destroy the John Does of the world and Jesus Christ for that matter. Dirty rotten politics! “Why their type’s are as old as history. If they can’t lay their dirty fingers on a decent idea and twist it and squeeze it and stuff it into their own pockets, they slap it down! Like dogs, if they cant eat it something they bury it.
      Why, when this fire dies down, what’s going to be left? More misery, more hunger and more hate. And what’s to prevent that from starting all over again? Nobody knows the answer to that one, and certainly not them, with those slimy bolloxed up theories they’ve got! The john Doe Idea may be the answer, though! It may be the one thing capable of saving this cockeyed world! Yet they sit back there on their fat hulks and tell us they’ll kill it if they cant use it! Well go ahead and try! They couldn’t do it in a million years, with all their radio stations and all their power! Because its bigger than whether John Doe’s a fake! Its bigger than their ambitions! And its bigger than all the money and gold in the world!” Long John Willoughby, {John Doe}, from, “Meet John Doe.” http://www.youtube.com/watch?v=9jOf8D4S7E
      Power corrupts and absolute power corrupts absolutely. You can bet your bottom Morgan silver dollar, on that!

  51. RUSS SMITH

    Hi!, Patrons Of USAWATCHDOG.COM Et Al:

    About a month ago I purchased 1 lb. units of New York Sausage for $5.18 a lb.; while yesterday, Memorial Day, the price was $6.14 per lb. which, if my math is correct, means that the price rose $.96 in a month or .1868% in just one month. Has this product hit a resistance level yet? Time only can tell.
    I’ve tried my best to explain to those who sell items retail that with inflation eating away at their profits, they need a system of forward thinking that allows them to lock in TRUE profits for a longer period; so that they can effectively replace products on their shelves without big losses to their bottom lines but most retailers don’t have a clue how to accomplish this for their own benefit and ultimate, longer term survival. Is it any wonder then that big buck retailers have decided to close their doors? The inflation thief is debilitating finances at every level including the consumer level due towages falling behind the essential cost of living.
    After shopping Memorial Day I took a break and sat on the super market’s park bench just this side of the exit door and asked some passers by if they thought that the price of fuel hovering around $3.80 to $4.00 per gallon in our area is a good “recovery” price and, should we loose the recovery, what price would fuel be then? Then pointed to my shopping cart to explain that every item in it represented fuel costs all the way to the tractor on the producers’ farm operations plus processing and transportation costs bringing every item to our super markets. These inescapable costs keep rising even under circumstances some economists regard as deflation. If the price of oil keeps rising so will the overall cost of living whether oils rising costs are do to the fall in the value of the US $ or otherwise. It’s a double hit on our pocket books in my opinion when wages fall behind these real world costs including the costs of hiring a mechanic etc. to work on our vehicles plus the costs for parts rising a well with the price of oil it takes to fabricate. No wonder Americans basically have little reserve, cushion savings to fall back upon during these very hard times.
    Greg, thanks for having Dr. Roberts someone informed enough to point out many things happening in our unstable world about which we need to be informed.

    RUSS SMITH, CA. (One Of Our Broke, Fiat Money States)
    resmith1943@gmail.com

  52. FWM

    thank you Dr Roberts for your honesty and patriotism god bless

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