When people accuse the Federal Reserve of anything when it comes to inflation, they say the central bank is cooking the books to hide it. Back in 2000, for example, monetary observers were aflutter as policymakers shifted away from the CPI and to the PCE Deflator as their ultimate standard for broad consumer price behavior. The bastards, the latter widely [...]
To hear it told nowadays, you’d think that gold’s amazing run began when Jay Powell started cranking out bank reserves. Those telling the story equate those bank reserves to effective money printing, so it conforms to the conventional myth about gold’s relationship to the money supply (whatever that is). Throw in a federal government, every federal government, recklessly borrowing and [...]
Not this again. When you really have run out of ideas, just set something aside for a time and then when it comes time again simply dust it off and pretend it is new and inspired. You can make it sound great, so long as no one remembers and realizes just how tired and ridiculous it actually is.It’s almost as [...]
It’s another one of those crisis-era programs, GFC1, the Fed probably hopes you never think too much about. Almost nobody noticed while the thing was operational. It was called the Supplementary Financing Program (SFP) which was thought up and initiated during the middle of September 2008 just two days after Lehman Brothers and AIG. Its purpose was, unbelievably, to drain [...]
After a record three straight months of decline for the seasonally-adjusted core CPI March through May 2020, it turned upward again in June. Buoyed by a partially reopened economy, the price discounting (prerequisite to the Big D) took at least one month off. No thanks to Jay Powell, of course, who sits on the sidelines while consumer prices (like the [...]
Foreigners are dumping their Treasuries! The Fed is monetizing the debt! The federal government has gone insane! Mass fiscal hysteria!Yet, yields on these things are comfortably within sight of their record lows as prices have never been higher. Supply is very obviously off-the-charts, but so, too, must be demand. Every time we hear about “too many” Treasuries the market yet [...]
Gold at $1800 an ounce has a lot of people you wouldn’t expect lining up in Jay Powell’s camp. What else could it be, right? Bullion is an inflation hedge, that’s what everyone says. Therefore, quite obviously, skyrocketing gold must indicate the dollar destruction gold aficionados are always predicting. Unbeknownst to them, and likely to agitate the hell out of [...]
Back in the middle of 2018, this kind of thing was at least straight forward and intuitive. If there was any confusion, it wasn’t related to the mechanics, rather most people just couldn’t handle the possibility this was real. Jay Powell said inflation, rate hikes, and accelerating growth. Absolutely hawkish across-the-board.And yet, all the way back in the middle of [...]
For awhile there, a few weeks anyway, the 30-year US Treasury long bond had become the star of the mainstream show. Showered with its 15 minutes of fame, everyone loved how, for once, it seemed to agree with Jay Powell and the preferred narrative about the effectiveness of his technocracy. The idiocy of this attention was exposed by just how [...]
According to Germany’s ZEW, economic prospects for the intermediate future in that country (and for Europe, separate survey) haven’t been this positive since 2006. Back then you might remember the rip-roaring contributions of asset bubbles, and I don’t mean the stock market and valuations. A huge wave of credit expansion in pretty much every corner of the globe courtesy of [...]
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