Where There’s Mania

Even the mainstream framework presented above is heavily influenced: irrational inflation mania in bonds according to the article’s title. No. The mania is in the media further fueled and fed by this Fed binary. The bond market, on the contrary, continues to express, trade, and price deep skepticism – this third option – as to whether either of those camps will ever be able to figure out.

Even in 2013, it was a hard sell this inflation stuff outside the financial press. Eight years later, same programs, now supposedly totally different result? As if the Japanese hadn’t already tested the “huge” number variable several times beginning with QQE (also in 2013).

Judy Shelton gets WSJ space, even a nomination to the Fed board if only because she’s actually on the same side, the QE “money printing” side. That she says it will go too far actually does Jay Powell a huge favor (boosting, in theory, inflation expectations which is really QE’s entire purpose).

The problem from the very beginning is just that simple. News to Shelton and others in her cohort, QE never was and never will be “money printing” nor “highly accommodative”. Her favor to Powell is in her helping him try – and fail all over again – to sell the illusion.

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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