Most people just don't understand...

Since 2008 the world has faced a massive depression which is going to have dramatic consequences in the future. Due to US Federal Government and Federal Reserve policy the US will most likely forfeit its status as the world's greatest power and its currency, the US Dollar, is likely to collapse completely. When I talk to most people, however, they do not realize the consequences of the Fed's current actions. Often this is because they have been brainwashed into trusting 'intellectuals'. The US Fed, leading universities, and government administration are made up of intellectuals. The current President of the USA is considered an intellectual. Most people, however, do not see the processes clearly because they do not know the facts. So here is a clear summary of the events which have led up to the crisis and the events which follow on now due to government policy:

Pre-2008 Era:
1. Government wants people to own homes ("American Dream" gone wrong).
2. They decrease lending standards by threatening banks as well as backing their loans with federal money (Standard "Carrot and Stick" technique).
3. Since loans are easy to obtain a lot more buyers (very reckless buyers) appear on the market.
4. Ergo, demand for houses rises.
5. Increased demand and stable supply means that all real estate prices rise (Law of Supply and Demand ABC's)
6. Prices rise steadily leading to over-investment in the housing industry, more lax lending standards, and massive indebtedness of the entire society as a whole (AKA the "Housing Bubble")

Post-2008 Era:
1. People can no longer receive cheap and wild loans.
2. Demand for real estate falls as people can no longer afford the inflated houses without equally inflated easy credit.
3. House prices start to fall and some people have to foreclose their mortgages.
4. More properties come on the market - banks try to recover assets by selling foreclosed properties.
5. Supply is up, demand is down - prices fall dramatically.
6. The banks themselves now go under due to their lax lending practices during the pre-crisis era.
7. The US government intervenes by pumping money into the reserves of the banks in order to keep them afloat - this is financed by the Fed inflating the money supply.

Today we are in a limbo which will be explained in my next blog post. This limbo is the result of the government now pursuing two mutually exclusive policies:
a) Keeping real estate prices high above factual market levels.
b) Keeping the Dollar from going into an inflationary collapse due to debt monetization or return to previous lending standards.
These two aims are incompatible with one another, and thus cannot be achieved.