One of the greatest misconceptions by financially illiterate political activists is to blame the FOMC on the inflation occurrence. They like to cite the “creation of money” as the impetus that caused inflation, which is false. The Fed had been printing money since 2008 and we only first saw signs of rapid inflation after 2021.
Why is that?
Did it ever occur to you the reason why inflation happened was due to the legislative and executive branches of govt, doling out over $5T in stimmy checks in order to satiate the poors? When you give money to the poorest people in America you are also, by happenstance, giving free money to the dumbest, in turn you run out of cars and semiconductors because they’re prone to spend 125% of whatever they make.
Under the auspices of fighting inflation, an inflation they did not cause, the Federal Reserve managed to bring rates to 5.25% while pinning stocks to record highs. I want to you to take a step back and acknowledge this achievement and then I want you to take a look at the USD/JPY cross and appreciate the magnitude of the Yen carry trade into the US and then I want you to look at Eurozone GDP and come to the understanding that they will move first to lower rates, thereby creating a Euro Dollar carry trade that will propel risk substantially higher.
To juice the forex returns, foreign central banks will concentrate on short term treasuries and diversify into equities, mostly large cap, and that might last another 2 to 3 years.
Societal collapse cannot be permitted to fester. They do not want that and they will do anything to buttress drops and create programs to continue the status quo, because for them things are good and they want it to stay that way.
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Thanks for the clarity.
Truly the actual Great Game
That is education. As you had alluded to this in an earlier post it is nice to see it spelled out clear as day.
Sounds like an advertisement for gold…and equities, of course.