Cool Graph -- $$$ Multiplier < 1.0 shows Fed about to crash & burn!Submitted by Agesilaus on Mon, 01/05/2009 - 12:28
Dec. 30, 2008, Market-ticker financial guru Karl Denninger posted a very cool graph showing the plummet of the money multiplier (MULT), in tandem with a concise, comprehensible explanation of how this shows that the Fed's fiat currency is out of control, like a stunt plane in a tailspin at an air show:
"The question now becomes whether Bernanke can overcome not only instinct but also political pressure to do the wrong thing and instead use his intellect - and the math - to do the right thing.
What is the right thing? Paradoxially, it is to withdraw liquidity and by doing so force the bad debt into the open where it does (and must) default."