Fed Reserve - Illusion of Understanding, Illusion of Control.

The expectations have grown for a United States of America interest rate rise in December and Gold and Silver are declining.

Us inflation is non existent as shown on recent reports at zero or near zero.  The Fed's target rate of inflation is 2%.  It is commonly witnessed that commodity prices and profits are falling rapidly and large commodity trading firms are struggling and this may get worse yet for them and the market.  Large reduction in Deutsche bank workforce coming.

Clearly with reducing profits and large job losses beginning in earnest now and starting to crunch in 2016 there will be downward pressure in wages and many household budgetary items.  Inflation expectations should be reducing not increasing if that is what the Fed are suggesting.

I cannot see how it would be helpful to raise rates in December and think it would be a BIG mistake if it were to happen.

I understand that rates are raised as things progress positively in an economy but that is a consequential step.   By putting up rates pre consequentially it will not bring the same outcome positively for the economy.  This is a strange and oddly hopeful backwards forwards scenario - these are the strangest days.

I think it only a matter of time before the bottom falls out of many markets and think it likely we will see commodity defaults eventually as some entities want to stand for delivery eventually and that is the point we will see a problem manifest very quickly.

Surely it is clear that the current economic financial state of affairs is totally and utterly unsustainable for much longer.   Something will give and when it does the complexity of the inter relationships of financial companies will lead to a systematic breakdown.

Warning given.

Have a good day.

http://www.prisonplanet.com/the-federal-reserve-illusion-of-understanding-illusion-of-control.html

JFI