Jim Grant on Libor, the Federal Reserve and the Status Quo, via Tyler

"You plant black walnut trees, and in 30 years they flower to $1000 each,
you pay $5 for them, that's a zero coupon tree,
that's where you get yield.

The Fed is not out of bullets;
the trouble is its gun shoot backwards.

These massive interventions in the marketplace distort the price
we call interest rates.

The banks fixed Libor.

The Fed fixes rates.

The banks do this surreptitiously and opportunistically.

The Fed does it for a living.

The idea ...that they are in charge of manipulating interest rates
is absurd.

The central banks do it all the time.

They do it massively.

The outrage ought to be directed at them...

Ever see the Truman Show
where Jim Carrey's character finds out he is living in a TV set.

He finds out because he rows his boat into the painted canvas sky:
that is life under the rule of central banks.

Everyone is talking about the "perfect storm":
the fiscal cliff, and China, and Greece, and Europe, there is a constellation of bad news:
the Wall Street Journal is the grimmest reading in years.

How can this be a perfect storm if we can see it coming?

Jim Grant via Tyler

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