{"id":20657,"date":"2023-05-07T19:48:30","date_gmt":"2023-05-07T19:48:30","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/louisiana-senator-compares-modern-banks-to-sophisticated-ponzi-schemes-economics-bitcoin-news\/"},"modified":"2023-05-07T19:48:30","modified_gmt":"2023-05-07T19:48:30","slug":"louisiana-senator-compares-modern-banks-to-sophisticated-ponzi-schemes-economics-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/louisiana-senator-compares-modern-banks-to-sophisticated-ponzi-schemes-economics-bitcoin-news\/","title":{"rendered":"Louisiana Senator Compares Modern Banks to ‘Sophisticated Ponzi Schemes’ \u2013 Economics Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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Louisiana Republican senator John Kennedy recently stated in an interview published on Wednesday that the U.S. Federal Reserve may need to increase the federal funds rate to 8-10% to address the country\u2019s inflationary pressures. Kennedy\u2019s remarks come after he criticized the Biden administration in mid-March for bailing out Silicon Valley Bank and Signature Bank, emphasizing that the decision to make all depositors whole \u201cwas a bail out,\u201d regardless of what it was called.<\/strong><\/p>\n

Senator John Kennedy: \u2018Powell\u2019s Gonna Have to Raise Rates Much Higher Than He Normally\u2019<\/h2>\n

During a recent interview with CNBC, Louisiana Republican senator John Kennedy expressed <\/a>his belief that the U.S. central bank will need to increase the benchmark bank rate from its current level of 5% to around 8-10% to combat inflation. Kennedy went on to state<\/a> that Federal Reserve chairman Jerome Powell will have to raise rates much higher than usual if Congress does not slow down its stimulus spending.<\/p>\n

On the same day that senator John Kennedy made his remarks, the U.S. Federal Reserve increased<\/a> the benchmark bank rate by 25 basis points (bps), marking the tenth consecutive rate hike and bringing the rate to its highest level in approximately 16 years.<\/p>\n

In addition to discussing inflation, Kennedy also addressed the issue of the debt ceiling<\/a>, calling for president Biden to have a serious conversation with House speaker Kevin McCarthy (R-CA) about how to allocate resources and reduce inflation. According to Kennedy, it\u2019s time for the leaders to have an \u201cadult discussion\u201d about this critical issue.<\/p>\n

Kennedy added:<\/p>\n

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I don\u2019t think you can do it without reducing the spending and debt.<\/p>\n<\/blockquote>\n

Kennedy Compares Modern Financial Institutions to Pyramid Schemes<\/h2>\n

Senator John Kennedy also addressed concerns about the U.S. banking industry, warning that modern technology can quickly turn a small disturbance into a full-blown panic. According to Kennedy, banks today rely heavily on trust, and are far less fortified than they used to be. In fact, Kennedy went so far as to compare modern financial institutions to pyramid schemes, stating that they are essentially \u201csophisticated Ponzi schemes.\u201d<\/p>\n

\u201cThey\u2019re really just \u2026 and don\u2019t take this the wrong way \u2026 sophisticated Ponzi schemes,\u201d Kennedy emphasized.<\/p>\n

U.S. Treasury secretary Janet Yellen recently warned<\/a> that the country could face a potential default on its debt limit in June, which could have dire economic and financial consequences. With the United States currently carrying a staggering $31 trillion in debt, the stakes are high.<\/p>\n

However, Republicans are refusing to raise the debt ceiling<\/a> unless certain mandates on green energy and climate change are repealed from the Inflation Reduction Act. Senator John Kennedy\u2019s recent comments on the issue come on the heels of his criticism<\/a> of president Biden\u2019s handling of the collapse of Silicon Valley Bank and Signature Bank in mid-March.<\/p>\n

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\nTags in this story
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banks<\/a>, Biden<\/a>, First Republic Bank<\/a>, Joe Biden<\/a>, John Kennedy<\/a>, louisiana<\/a>, modern technology<\/a>, Ponzi<\/a>, pyramid schemes<\/a>, Republican<\/a>, senator<\/a>, Signature Bank<\/a>, Silicon Valley Bank<\/a>, sophisticated Ponzi schemes<\/a>, trust<\/a>, US banks<\/a><\/div>\n<\/div>\n

What do you think about senator Kennedy\u2019s comments? Do you agree or disagree with his assessment? Share your thoughts in the comments section below.<\/strong><\/em><\/p>\n

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\nJamie Redman <\/h6>\n

\nJamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 7,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

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