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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There has been a lot of recent chatter about a superconductor breakthrough, but at this early stage, it would be wise for investors not to dive in headfirst but keep developments on their radar. The scientific community remains divided as to whether the latest superconductor breakthrough is genuine. In other words, the superconductor breakthrough could be just hype leaving gullible investors holding the bag. Alternatively, if the...
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Fed tightening cycle could be maturing, and the engineered recovery in financial assets may be allowed to continue making a soft landing possible. The Fed is in the cockpit of a metaphorical jumbo plane, navigating global financial markets, the global economy mindful to fly clear from the coffin corner. A too-high altitude, red hot economy, raging bull market with runaway inflation, and the jumbo loses control and crashlands. If the...
Read MoreQuantitative tightening QT continues as the Fed restricts its asset purchases. The Fed’s total assets dropped again by $87 billion in June and by $667 billion since the historic peak in April 2022, according to the latest Fed’s H.4.1 weekly balance. The Fed’s total assets stood at $8.298 trillion, the lowest amount since August 2021. QT started in April 2022, with the downward trajectory in the Fed’s total assets...
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Are we on all roads to totalitarianism, a system where everything is centrally controlled, where there are no free markets or price discovery, and where there is extreme regulation, and control over capital, information and even your movements? “One of Karl Marx’s ten planks in his Communist Manifesto to seize power is the centralization of credit in the hands of the state, through a national bank with state capital and an...
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