Yesterday’s decision will go down as one of the biggest policy errors in US history. It will likely be more consequential than the presidential elections, and most people haven’t a clue.
Policy makers need to seriously reevaluate how we structure our corporate boards and regional fed advisory boards. What financial institution CEO can ethically recommend an end to low rates, when doing so would blow a hole in their balance sheet? How about scaling back the BTFP? The FHLB lending program?
In 2022-23 we actually saw M2 tick down, granted not a lot - but it was actually negative. Well that did not last long as we have seen M2 trend higher again in 2024. Now we will see interest rates come down and we will see people leverage back up and round 2 of inflation.
The baby boomers will mostly be ok - good percentage have their houses paid off and have accumulated enough money to survive.
The next 3 generations are going to be FUCKED. People are not saving, living paycheck to paycheck. I was doing a 401k review yesterday - company with 200 employees. Only 6 of 200 will have enough money to actually retire. Was talking to some middle management people (making $100K+ living in Iowa) - worrying about never being able to retire, the one person referenced having 3 boys and she averages $450 / week on groceries.
When round 2 of inflation comes in the next 24 months - it is going to be crippling.
in his own mind he probably means the nation's citizens. after all, looking at "the data" the economy has done & is doing pretty well. nobody can dispute that based on published data.
but if someone notes all the hedonic adjustments and gamesmanship in data numbers such as part-time jobs vs full time, etc. -- well, maybe not so good.
it's always been like this.
there's always complaints, after all even in the 1960s -- the great boom time -- there were protests about poverty. In the boom-time 1980s there were complaints about Reagan deficits.
In the tech bubble late 1990s I don't recall much complaining, but complaining was becoming unfashionable and the zeitgeist was "your'e a loser, learn to code" if you complained.
After the 08-09 crisis there were complaints about all the bailouts. They were legitimate complaints, I agree! But they were buried and people forget.
There were even complaints about quality/consistency of economic data going back decades.
There's always complaining.
But there has not yet -- not yet! - ever been a social/economic/political collapse of any kind. maybe once in U.S. history -- the Civil War. And The Great Depression of 1930s.
I remember reading stuff like this when Ronald Reagan was president. The longer you are wrong the easier it gets -- because people die and culture forgets. PT Barnum was right. They may be suckers but they can read!
So when 50 years later you read the same thing, it seems "new" and "provocative".
It isn't new. It's old. Rusty, dusty, decrepit, broken, out of gas, unplugged, corroded and disintegrating from age. Just like people.
If you've never seen it before now, it seems new.
Eventually it will be right. But if you want to make money investing, be careful believing it to soon. Maybe after 40 years the time is right, now, today? Maybe its time has finally come, I agree.
Yesterday’s decision will go down as one of the biggest policy errors in US history. It will likely be more consequential than the presidential elections, and most people haven’t a clue.
Policy makers need to seriously reevaluate how we structure our corporate boards and regional fed advisory boards. What financial institution CEO can ethically recommend an end to low rates, when doing so would blow a hole in their balance sheet? How about scaling back the BTFP? The FHLB lending program?
Word.
In 2022-23 we actually saw M2 tick down, granted not a lot - but it was actually negative. Well that did not last long as we have seen M2 trend higher again in 2024. Now we will see interest rates come down and we will see people leverage back up and round 2 of inflation.
The baby boomers will mostly be ok - good percentage have their houses paid off and have accumulated enough money to survive.
The next 3 generations are going to be FUCKED. People are not saving, living paycheck to paycheck. I was doing a 401k review yesterday - company with 200 employees. Only 6 of 200 will have enough money to actually retire. Was talking to some middle management people (making $100K+ living in Iowa) - worrying about never being able to retire, the one person referenced having 3 boys and she averages $450 / week on groceries.
When round 2 of inflation comes in the next 24 months - it is going to be crippling.
One sentence that Powell said explicitly in his interview comments, " we made a decision based on the people we serve". Let that sink in...
in his own mind he probably means the nation's citizens. after all, looking at "the data" the economy has done & is doing pretty well. nobody can dispute that based on published data.
but if someone notes all the hedonic adjustments and gamesmanship in data numbers such as part-time jobs vs full time, etc. -- well, maybe not so good.
it's always been like this.
there's always complaints, after all even in the 1960s -- the great boom time -- there were protests about poverty. In the boom-time 1980s there were complaints about Reagan deficits.
In the tech bubble late 1990s I don't recall much complaining, but complaining was becoming unfashionable and the zeitgeist was "your'e a loser, learn to code" if you complained.
After the 08-09 crisis there were complaints about all the bailouts. They were legitimate complaints, I agree! But they were buried and people forget.
There were even complaints about quality/consistency of economic data going back decades.
There's always complaining.
But there has not yet -- not yet! - ever been a social/economic/political collapse of any kind. maybe once in U.S. history -- the Civil War. And The Great Depression of 1930s.
That should be food for thought.
I remember reading stuff like this when Ronald Reagan was president. The longer you are wrong the easier it gets -- because people die and culture forgets. PT Barnum was right. They may be suckers but they can read!
So when 50 years later you read the same thing, it seems "new" and "provocative".
It isn't new. It's old. Rusty, dusty, decrepit, broken, out of gas, unplugged, corroded and disintegrating from age. Just like people.
If you've never seen it before now, it seems new.
Eventually it will be right. But if you want to make money investing, be careful believing it to soon. Maybe after 40 years the time is right, now, today? Maybe its time has finally come, I agree.
But I'm not sure.
When will grocery stores start taking precious metals by weight?
Truth, thanks for sharing.
Finally... The TRUTH in print. Thanks
Financial repression is coming like a freight train