Washington, DC -- (ReleaseWire) -- 02/18/2016 --In testimony before the House Financial Services Committee last week, Janet Yellen made the amazing assertion that the economy is in many ways 'normal.' "The economy is in many ways close to normal," she said, "in the sense that the employment rate is declined to levels that most of my colleagues believe are consistent with full employment in the longer run. And inflation while it's below two percent, I do think there's a good reason to think it will move up over time. In that sense, things are normal." Amazing. Normal? Extreme volatility in the markets, sharp movement in the dollar, defaults on corporate and municipal loans: normal?

In the same testimony, Yellen also hinted that the Federal Reserve is considering abandoning the current (near) zero interest rate policy (ZIRP) and moving to a negative interest rate policy (NIRP), if needed to prop up the economy. The Fed hates to surprise the markets, so they regularly telegraph their intentions with leaks and hints, allowing them to watch market reactions to these bits of not-quite-information. Often, they do this for months. Remember back to 2013, when there were two open-ended quantitative easing programs running? Rather than announcing a taper, then-Fed Chairman Ben Bernanke hinted that the central bank was thinking of tapering starting in June. What happened then? The markets reacted sharply, with bond yields rising. So, it seems NIRP might be on the horizon indeed.

Let's look at what NIRP might actually mean. It's simply a monetary Twilight Zone. When the European banks implemented NIRP beginning in 2012, it looked something like this: An overindebted sovereign was dependent on domestic banks to buy that debt, but when deals on that debt spiked, the banks took a hit. That left the banks in a weaker position to fund the sovereign state, leading to further cuts. Then weak banks, weakened further by draconian regulatory regimes, pulled back on lending in general, weakening the economy as a whole. A spiral of doom. And here we are, contemplating this?

In the end, the question to ask about NIRP is this: are you willing to pay the United States Government to hold on to your money? Because that's what negative interest rates mean. We're already at the point where the Fed's policies are trying to push Americans out of savings and money market accounts and into risk assets. Consider that at current rates, a retiree with a million dollars in savings will earn, if they're lucky, a measly 1,000 or 1,500 per year in interest income. With NIRP in effect, that will be even worse.

The Federal Reserve's policies of printing money and manipulating markets over the last six years have increasingly replaced fundamentals and basics with only one driver to the market: the Fed itself. There is simply no longer a free market, no longer anything recognizable as capitalism, when the single question an investor must ask first and last when making decisions is "What will the Fed do?" Beyond this destruction of capitalism, though, these policies are a fundamental, existential threat to our republic itself.

The central banks are certainly a threat, but they're not doing it alone. As Julius Caesar says in Shakespeare's play, "The fault is not in our stars, dear Brutus, but in ourselves." In October of 2015, Google Consumer Surveys released the result of a survey, saying that roughly 62 percent of Americans have less than $1000 in savings, while 21 percent have no savings at all. No emergency savings for a medical issue, or new car tires, or a flooded dishwasher. It is true that some significant part of that is because of stagnant real wages, un- and underemployment, and the very government and central bank policies we speak of above. However, Americans are not blameless in this. Many of us have given in to the debauchery of debt, spending to fulfill our urges for immediate gratification without considering the future.

Since the 1980s, the US population has grown by a factor of 1.42, GDP by 6.3, but consumer debt by a factor of 10. Back in 1980, average per capita consumer debt was $9,300, but today, it is $65,200 per person. We now hold $21 trillion in mortgages and credit cards and student loans and other debt. And the central banks can't fix this. Only we can, by realizing that the Fed can't keep this bubble expanding forever, because market bubbles have a mind of their own. All of us need to start acting like responsible adults and taking care for the future.

So, are we looking at the end of one economy, and perhaps the beginning of another? The equities markets, where the Fed would like you to put your money, are down. The Dow down eight percent year to date, the NASDAQ down 12 percent, the Russell 2000 down 14 percent. But gold? Gold is up 17 percent for the year. In less than a month and twelve days.

Now, most asset investors hate gold. Even leaving money in the bank is preferred, the way society thinks about it now. But once you buy physical gold, no one has access to that sliver of your portfolio. When gold rallies like this, it's essentially a protest vote against the global financial system. The equivalent of taking your ball off the playground and going home. It is almost as if we are penning the market's obituary with what gold is telling us.

For over a quarter century, the experienced advisors of Bennett Group Financial Services, LLC have been successfully guiding clients through the complexities of wealth management. Bennett Group Financial Services provides individual investors, corporations and foundations with holistic investment strategies using unique portfolio solutions across a breadth of asset classes. Our unique vision and insight into market trends makes Bennett Group Financial Services a much sought after expert resource with regular appearances on Fox News Channel, CNBC, Bloomberg TV, and MSNBC as well as being featured in Business Week, Fortune, The NY Times, The NY Sun, Washington Business Journal in addition to our highly regarded weekly talk radio program - Financial Mythbusting. Through attentive service and prudent, thoughtful advice, Bennett Group Financial Services, LLC strives to consistently provide its clients with the highest quality of guidance and personalized service available.

About Dawn Bennett
Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com.

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett.