If Treasury markets can’t be reigned in, the Fed expands its balance sheet by buying those Treasury securities to add liquidity and stability. These “open market operations” are usually the “money printing” that people are talking about happening at the Fed. “QE” refers more specifically to operations where the Fed is buying other assets beyond just Treasury securities, as occurred in the 2008 crisis and during COVID. But the Treasury buying back its own issued debt is, in essence, QE by another name.

When interpreting Treasury yield data, remember that this market is being heavily manipulated by Yellen – she's conducting the Treasury versions of both Operation Twist and QE, w/ overreliance on short-term issuance and now buybacks; term premium is now virtually nonsensical: pic.twitter.com/RH8UixQOMK

— E.J. Antoni, Ph.D. (@RealEJAntoni) May 1, 2024

While this occurs outside the halls of the Federal Reserve itself, Treasury buybacks are merely a different way to print money from nothing. The US is running a deep, sustained fiscal deficit with no true debt ceiling — so the Treasury buys back its own securities by issuing new debt, which it creates out of thin air. With spending far exceeding revenue, higher interest rates plus more debt means that fiscal deficits accelerate. The short-term stimulative effect of this somewhat offsets the Fed’s tightened monetary policy but digs a deeper hole in the longer term.

One method the Treasury uses is to shorten the average duration of securities so that debts mature sooner. That means more short-term debt (like Treasury bills) versus long-term debt (like Treasury bonds). This encourages more capital flows into the banking sector and helps stave off instability. If it fails, the big banks still win: when smaller banks fail, they’re usually just absorbed by bigger ones where the profits are private but the losses are socialized. The “Too Big to Fail” club becomes even bigger and more powerful.

When the Treasury issues more short-term debt, it’s waging war on the Fed’s higher interest rate policy. Both the Treasury and Fed need to keep Treasury yields down, but tightened monetary policy encourages higher yields. If yields get too high, the bond market — and challenged industries like commercial real estate that rely on debt — are screwed. So while the Fed tightens, the Treasury must loosen. Yields have since gone down, but if inflationary pressures and other factors push them back past 5%, both the Fed and Treasury are trapped.

“Higher for longer” policy at the Fed is even more essential for holding back inflation as the Treasury injects liquidity into markets. If the Fed lowers rates now, the results of simultaneously expansionary monetary and fiscal policy will send consumer prices soaring.

So are the Fed and Treasury in opposition, or are they working together, one changing its policy to prevent a disaster caused by the policies of the other? The answer is complex, but the oversimplified version is that the two have locked the economy into a game of musical chairs where, eventually, the music is bound to stop.

The end result of the Treasury’s showdown with the Fed will still be out-of-control inflation. Both artificially contract and expand the money supply, and their policies have both created an inescapable trap. COVID QE is one big unexploded bomb that is sitting in the center of that trap. And even with the Fed holding off on interest rate cuts in the short term, the Treasury’s buybacks are QE by a different name. With too much inflationary pressure and not enough tools to stop it, the end result of all this fiscal and monetary tinkering will be a disaster for the dollar.

Doing exactly what the film itself warns is becoming normalized, the Treasury, a federal government agency, blocked a transaction to the Salem Media Group, which produced “Police State.”

The Financial Crimes Enforcement Network of the U.S. Department of the Treasury, which even more ironically enough is responsible for tracking terrorism and narcotics trafficking, decided to “intercept” a $106,000 payment that was intended to purchase ads for the D’Souza film.

The Treasury Department has yet to address the delayed payment, which occurred right around the time that the nation’s largest banks were failing to transfer customers’ direct deposit payments through the ACH system.

“Although the Treasury Department remains silent on their actions, the delay has already begun to create waves and provide a real-time example of the content pointed out in the film,” reports Reclaim the Net.

(Related: The Treasury bond market is collapsing – what will this mean for the markets at large?)

The money was eventually returned, but why was it seized in the first place?

Since the job of the Office of Foreign Assets Control (OFAC) is responsible for enforcing economic sanctions and monitoring assets primarily against terrorist cells and narcotics traffickers overseas, it is unprecedented for this agency division to suddenly take an interest in this local matter.

OFAC’s jurisdiction usually involves foreign transactions, in other words, and not domestic affairs like something as simple and benign as purchasing advertisements for a new film release.

“Is this some kind of bureaucratic police state tactic to tie up our funds without explanation?” D’Souza himself asked.

Since OFAC refuses to explain itself concerning the matter, D’Souza has expressed concerns that this is possibly a censorship effort via financial disruption tactics, which is a new low for the Treasury.

“This incident vividly demonstrates an alarming reality where production money for a documentary on democratic values can get tangled in the webs usually reserved for criminal enterprises,” says Reclaim the Net.

“Police State” debuted both online and in theaters across the U.S. this past month. The film deals with subject matter similar to what is now taking place against the film itself by the Treasury.

The film “digs into the deeply troubling evolution of an escalating police state targeting the common citizen; the unprecedented political persecution orchestrated under the Biden regime is uncloaked for all to see,” Reclaim the Net explains.

D’Souza says America today has become “a scary place to live,” which is why he created the film in the first place: to provide “a chilling take on the reality of a fast-approaching police state.”

“Police State” premiered at Donald Trump’s Mar-a-Lago resort, and was attended by Jim Hoft of The Gateway Pundit. The film was made possible in part through a partnership with Dan Bongino.

It was later reported that the seized funds were returned to D’Souza in the afternoon the same day that the incident occurred. Even so, the shockwave that this incident caused, appearing like some kind of political retaliation, is something that seems like it could have come from a scene straight out of the film itself.

“When you look at the police states around the world – North Korea, China, Iran, Cuba, the old Soviet Union – the defining characteristics are things like mass surveillance, censorship, ideological indoctrination, and propaganda in the schools and media,” D’Souza explained about the film in a recent interview.

“You go down this list and realize that many – maybe not all, but many – of these characteristics are right here in this country. It is very disturbing what is going on, and it’s not just happening to Trump.”

The latest news about America’s burgeoning police state can be found at PoliceState.news.

Sources for this article include:

• ReclaimTheNet.org
• NaturalNews.com
• WIBC.com

Treasury Secretary Janet Yellen announced through a press release that they are lifting the $250,000 FDIC insurance limit. She proudly announced twice in her release that taxpayers wouldn’t be hit with the burden. This means they’re going to print more money.

Did FDIC insurance for depositors just become unlimited ??? pic.twitter.com/sS8Okhtkiw

— Wall Street Silver (@WallStreetSilv) March 12, 2023

According to the press release:

Washington, DC — The following statement was released by Secretary of the Treasury Janet L. Yellen, Federal Reserve Board Chair Jerome H. Powell, and FDIC Chairman Martin J. Gruenberg:

Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system. This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth.

After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13. No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.

We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority. All depositors of this institution will be made whole. As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer.

Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.

Finally, the Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors.

The U.S. banking system remains resilient and on a solid foundation, in large part due to reforms that were made after the financial crisis that ensured better safeguards for the banking industry. Those reforms combined with today’s actions demonstrate our commitment to take the necessary steps to ensure that depositors’ savings remain safe.

Bad fiscal policy hurts everyone. Some will be affected in the near future. Many of us will be impacted immediately. But the Democrats’ Big Tech cronies will have their suffering minimized at the expense of everyone else.

Editor’s Note: Now would be a good time to talk to Genesis about physical precious metals.