By Mike Larson – Money and Markets

Fed chief Ben Bernanke has just proven what many have suspected all along is indeed true: The U.S. Federal Reserve is patently INSANE!

In reporting on the FOMC meetings, “Helicopter Ben” announced that the Fed is going to do the same old thing and expect better results:

It’s going to hold interest rates near zero as far as the eye can see …

And it’s going to print $40 billion new dollars per month in an attempt to stimulate the economy — $480 billion per year!

In short, it’s doing the same things it has done since 2008 — but expecting a different outcome.

Any way you look at it, that’s the very definition of insanity.

Look: The Fed has already held interest rates near zero percent for four long years, now.

It has already created $1.8 trillion out of thin air through QE I and QE II …

And it has already bought hundreds of billions of dollars more long-term Treasuries as part of Operation Twist 1 and 2.

So what’s the result? No impact whatsoever on the real economy!

Sure — all that free, easy money can temporarily lift the stock market. But despite everything the Fed has done …

  • Unemployment has stayed over 8% for 42 straight months …
  • The average family home is still falling in value …
  • Profits at many major corporations still stink — and they’re getting more rotten almost by the day …
  • U.S. economic growth is still grinding to a near standstill …
  • And now, as America approaches the precipice of its great fiscal cliff, the stock market looks for all the world as if it’s a massive bubble about to burst!

Worse, the middle class — the very backbone of the U.S. economy — is getting eaten alive:

Household income is plunging: The U.S. Census Bureau just reported that real median household income has now fallen for the fourth straight year.

  • Income has fallen so low, in fact, that when you adjust for inflation, the median family has the same income today as it did in 1967 — 45 long years ago!

The income gap is widening alarmingly: The Census Bureau is also reporting that the movement of income away from the middle class has just hit a record high.

  • Typically this kind of increasing disparity in income occurs just before economic calamities — and today, it’s more extreme even than before the 1929 stock-market crash and the Great Depression!

U.S. poverty is at all-time record high levels: Finally, as if to add insult to injury, the Census Bureau also reports that a staggering 46.2 million Americans now live in poverty!

  • And not only isn’t the Fed helping … its failed efforts to revive the economy are creating a second crisis.

Thanks mostly to the Fed’s past money-printing gambits, in August …

  • The Producer Price Index just jumped 1.7% — hands-down the biggest surge in producer price inflation going back to June of 2009!
  • The Consumer Price Index zoomed up by 0.6%, the single-biggest monthly jump in inflation going all the way back to June 2009. And …
  • After adjusting for inflation, average hourly earnings PLUNGED 0.7%, the biggest monthly decline since summer 2009!

Make no mistake:

The U.S. economy is broken.

Nothing the Fed can do will fix it.

To the contrary: The Fed’s easy money policies created this crisis in the first place by inflating the housing bubble. Now, they’re only making matters worse — doing absolutely nothing for the job market, while driving inflation higher!

And as America’s great Fiscal Cliff approaches — the catastrophe that JPMorgan says will push America “head-first into the fiscal meat grinder” — the storm clouds are darker than ever.

This is why we produced our new video — The Great Default — and why it is absolutely imperative that you view it immediately.

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  • Tear trillions of dollars out of the hands of U.S. consumers and companies …
  • Bankrupt thousands of businesses …
  • Drive the unemployment rate to unimaginable levels, and …
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