The Fed and Congress were shitfaced drunk when they expanded the money supply during COVID, and we are now in deep hangover. The Fed's little rate rises have barely dented that money supply, which is still far higher than it was when 2020 began. And IOER being paid on the Fed's massive balance sheet keeps expanding the money supply. I think rates will have to go much higher, and they may be forced to reduce interest on excess reserves as that counteracts the effect of the rate rises.
I took a different route to predicting the Fed would go higher in way fewer words. How about not wanting to allow smaller banks to improve the bad marks they're taking on CRE debt by relaxing rates. Let a few more go under, refuse to rescue them since they're not part of the 1% crowd. JPM cherrypicks what they want at bargain prices, and we have the handful of big banks the govt wants going into the CBDC era.
LOL!!! Oh man, if I could write as awesomely as QTR , I would just stay at home all day and write haiku's in the bathroom. I'm wondering, if the bond holders will be buying bonds hand-over-fists when J Powel decides to start cutting rates (after the economic crash of Biblical proportion) ?
A great analogy of the foolish Fed policy, LOL
The Fed and Congress were shitfaced drunk when they expanded the money supply during COVID, and we are now in deep hangover. The Fed's little rate rises have barely dented that money supply, which is still far higher than it was when 2020 began. And IOER being paid on the Fed's massive balance sheet keeps expanding the money supply. I think rates will have to go much higher, and they may be forced to reduce interest on excess reserves as that counteracts the effect of the rate rises.
Frank the Tank is coming back... prepare the tranquilizer pistol.
Fabulous! Great post.
Boy, you had one hell of a 21st birthday!
Lol, yeah. Mine was chill. I bought a decent bottle of rum and chilled at a cigar bar.
My buddies came to visit me at school and....I don't remember what we did.
LOL
I took a different route to predicting the Fed would go higher in way fewer words. How about not wanting to allow smaller banks to improve the bad marks they're taking on CRE debt by relaxing rates. Let a few more go under, refuse to rescue them since they're not part of the 1% crowd. JPM cherrypicks what they want at bargain prices, and we have the handful of big banks the govt wants going into the CBDC era.
LOL!!! Oh man, if I could write as awesomely as QTR , I would just stay at home all day and write haiku's in the bathroom. I'm wondering, if the bond holders will be buying bonds hand-over-fists when J Powel decides to start cutting rates (after the economic crash of Biblical proportion) ?
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