An economic downturn is on the cards, bearing in mind that is what the Fed’s restrictive tight monetary policy to put out the inflation fire will do, crush aggregate demand in the economy. Already a staggering 37% of Americans lack enough money to cover a $400 emergency expense, up 32% in 2021. With household disposable income already tight, the Fed’s latest September rate decision to keep the Fed funds on hold was...
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The Fed’s QT Quantitative Tightening continues as inflation remains elevated and could even keep rising as WTI crude oil prices hit an all-year high at nearly 90 USD a barrel. The Fed has already reduced 24% of the Treasury securities it had added during pandemic QE. Moreover, the Fed’s QT liquidity unwind from the bank bailouts in March continued: The Fed’s total assets fell by $105 billion in August, and by $864 billion...
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