Central banks are no longer independent

In an interview the  former chief economist of the ECB and monetary hawk, Jürgen Stark made some interesting remarks about global central bank policy:

Central banks (in the US, Europe, Switzerland and Japan) are flooding the financial system not to avert deflation but to support economic growth and decrease interest rates of over indebted government. Hence, there policy is no longer independent. The chart below show the explosion of money supply. Only the central bank of  Japan did not increase its balance sheet (yet), but this might happen soon, as the new PM Abe is demanding a weaker currency.

Today, central bankers are trouble shooters for non-monetary problems like weak economic growth, high unemployment and the burden of interest payments for over indebted governments, which is increasing the bankers power enormously.

The result of the monetary flood is financial repression (i.e. savers lose out due to interest rate not covering inflation anymore) and bubbles in various asset classes (e.g. bonds, swiss real estate etc.).

At the moment the increased money supply is not inflating consumer prices because the liquidity is not fueling the real economy (the liquidity is contained in the financial system fueling asset bubbles). But once the transmission works again and prices increase, it is doubtful whether central banks are willing and able to reduce this monetary sea in due time. In that case we will face substantial inflation!

To protect your investments you have to find real assets which are not yet in bubble theory. As indicated, real estate could be the wrong place to be!