When Bernanke panicked and lowered interest rates in response to the whining crowd of stock market investors, credit became cheaper: a lot cheaper, in fact, the interest rate in the USA dropped from 4.25% to 3% within a few days. This is a savings of 29,4% to the “grasshoppers” who borrow money freely and a minus of 29,4% to the “ants” who toil all summer long to save for the winter.
People who saved got punished, while those who got in over their heads are being rewarded.
And the punishment will be extended to the very limits of society as inflation will make life more expensive for everyone.
Buy Gold.
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