The main difference today versus the past is the debt/gdp and deficit /gdp are significantly higher in nose bleed seats today versus the past. For all practical purposes we are in a state of fiscal dominance. We have not been there since after WWII. We are probably closer than most think to AI replacing a significant number of middle management white color workers comparable to the decline of manufacturing jobs after China was allowed into the WTO (35% decline in 5 or 6 years). All those folks have mortgages, car loans, school loans, etc... All of which will only make the fiscal situation in the US that much worse. Certainly these are reasons for the FED to come to the rescue, but again one big difference today is not so much that the FED is a political animal, as that has always been the case and that 99.5% of the those employed there support Democrats, but the Chairman loathes 47, and sitting on his hands claiming inflation has not met is pie in the sky inflation targets would not be a surprise or a far stretch. Perhaps there will be a greater urgency to accommodate with lower rates and FED printing when Warsh assumes the Chairman position, but I would not be surprised to see Powell stay on and finish out his Governor term which ends in 2028 just to be thorn in the side. Afterall he does not GAS!
I wish your charts were legible and expanded to full screen.
mista hayes the pictures need to be reuploaded with higher resolution, i dont want to waste tokens to ai upscale in order to read them
thank you for your attention on this matter
Nice post Isaac, but buying when the Fed cut rates...wouldn't it be too late?
The main difference today versus the past is the debt/gdp and deficit /gdp are significantly higher in nose bleed seats today versus the past. For all practical purposes we are in a state of fiscal dominance. We have not been there since after WWII. We are probably closer than most think to AI replacing a significant number of middle management white color workers comparable to the decline of manufacturing jobs after China was allowed into the WTO (35% decline in 5 or 6 years). All those folks have mortgages, car loans, school loans, etc... All of which will only make the fiscal situation in the US that much worse. Certainly these are reasons for the FED to come to the rescue, but again one big difference today is not so much that the FED is a political animal, as that has always been the case and that 99.5% of the those employed there support Democrats, but the Chairman loathes 47, and sitting on his hands claiming inflation has not met is pie in the sky inflation targets would not be a surprise or a far stretch. Perhaps there will be a greater urgency to accommodate with lower rates and FED printing when Warsh assumes the Chairman position, but I would not be surprised to see Powell stay on and finish out his Governor term which ends in 2028 just to be thorn in the side. Afterall he does not GAS!
I wish your charts were legible and expanded to full screen.
Since 1985, every article by Arthur Hayes has predicted the Fed's money printing as a result of “current events.”