On July 23, 2020, CNBC published an article by Elizabeth Schulze headlined: Here’s why economists don’t expect trillions of dollars in economic stimulus to create inflation. That one didn’t age well, did it? At the time CNBC published this article, the Federal Reserve had expanded its balance sheet from $4 trillion to roughly $7 trillion. […]
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Bonds continued to get hammered. On Tuesday morning, the yield on the 10-year Treasury rose above 2.9%, and the yield on the 30-year is knocking on the door of 3%. Since bond yields rise as bond prices fall, this indicates a serious decline in the bond market. In his podcast, Peter Schiff said that at […]
The post Peter Schiff: The Risk of a Market Crash Keeps Growing first appeared on SchiffGold.
MarketsInsider/Theron Mohamed/4-14-2022
“Burry accused the US central bank of raising interest rates and shrinking its balance sheet not to combat inflation, but to give itself room to pump up asset prices when they inevitably fall. ‘The Fed has no intention of fighting inflation,’ he tweeted on Thursday. ‘Serial half-point hikes are for getting elevation before stocks and the consumer tap out. Same with rapid-fire QT.’”
USAGOLD note: The Big Illusion …… a hawkish Fed. Dennis Lockhart, former president of the Atlanta branch of the Federal Reserve, is worried that policy will undershoot the situation allowing inflation to “really seep into every crack of the economy and become really deeply embedded in the psychology…” (Financial Times/Can the Fed stamp out US inflation without causing a recession?/4/14/2022)
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ZeroHedge/Michael Every/4-14-2022
“Details matter. Or they should. In reality the dirty secret in markets is that nobody actually pays attention to them. … [A] case in point is US CPI, which you would have to be getting an 8% yield on a gold coin to keep up with. US headline inflation hit 8.5% y/y yesterday, a tick higher than expected, but the market focus was on the 0.3% m/m core print, which was 2 ticks lower than consensus. Along with the recent dip in oil prices, the sudden view was again that we have seen ‘peak inflation’. Happy days!”
USAGOLD note: That reference to the required yield on gold coins to keep up with inflation is a classic – and one that goes straight to the heart of the problem the Fed is up against. Peak inflation? “[T]oday we have entrenched inflation,” writes Every, “a Fed prepared to ‘meticulously’ ensure it becomes unentrenched, and a geopolitical backdrop that favors decoupling [important trade relationships], which cannot be anything other than inflationary.” Rather than paying attention to detail and making an objective assessment, the tendency even among seasoned hedge fund operators is to run with the crowd instead.
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