Wondering what you folks think of this reasoning. I pieced this together from various things Greg Mannarino has said in his video updates the past few days, but not sure if he would veto this way of putting things together.

1. Greg says the economy is in "meltdown" or "free-fall" and regular people are now borrowing against their credit cards in record numbers just to make ends meet.

2. He also says that the Fed is making this money available to the banks at close to zero (or less than zero) interest, so that the banks can then turn around and lend the money to us peasants at huge interest rates, such as what we see on credit cards.

3. Evidently the level of corporate debt is also extraordinarily high right now, which suggests that companies are borrowing large amounts in order to stay afloat.


Is it possible that we are seeing the economy in meltdown, both from a corporate and an individual perspective, but the Fed is trying to hide that fact for a while? It creates money and lends it to banks, who then turn around and give that money to companies and people to keep them just barely solvent for a while, but at the cost of becoming deeply indebted.

Under such a scenario the pundits could continue claiming that the economy is "booming" and the consumer is "strong", because us little people can't see what is really going on behind the scenes. Each person in isolation thinks it is just them that is suffering, but really it's almost everyone. This could presumably continue for a while, as the global central banks maneuver themselves into the best possible position before cutting off the spigot of "liquidity". At that point, every indebted company and individual household will be simultaneously bankrupted, and all collateral assets will transfer to the central banks. That is, endgame.

Going against this logic however is the fact that money velocity is at an all-time low. If the money from the Fed was being dispersed to companies through loans and to individuals through credit cards, wouldn't we see the money velocity go up, potentially sparking hyper-inflation?

Thoughts? Does this make sense to you folks? I don't know if it's right or not, just trying to understand what's happening. Thanks.