We believe there will be multiple fiscal stimulus rounds. When one considers the stalled economy, negligible Real GDP growth and high unemployment, it would seem that this $2 Trillion stimulus round under discussion won't be sufficient to satisfy the narrative that Government needs to do more. When one factors in runaway entitlements (table below), it … Continue reading Multiple Fiscal Stimulus Rounds Are Coming. Good News for Equities. Bad News for The Real Economy.
Mainland China is not bullish on the U.S. Economy. China's U.S. Treasury holdings have generally declined since 2013 from a peak of approximately $1.32 Trillion (Nov-2013) to $1.07 Trillion as of Jul-2020. Charts and graphs are at the article's end Both the U.S. and China have interventionist fiscal and monetary policy. The difference is that … Continue reading China Is Not Bullish On The U.S. Economy
Fed Chair Powell's comments on Thursday were in-line with our perspective published on Wednesday. The Fed will continue to work to "stimulate" the economy (it can't of course, it can only inflate asset prices). However, every time Chairman Powell mentioned "full employment" in his speech I couldn't help but think of the job dislocation that's … Continue reading Dovish Fed Policy Speaks to A Weak Economy and Permanent Job Dislocation. We Propose A Solution.
This next round of debt-funded stimulus will ensure that the U.S. economy look much like Japan's at least for the next decade if not the next 20-30 years. The fiscal side of the ledger is a deficit-promoting mess and the monetary side is complicit by way of subsidizing the debt. Fed official Neel Kashkari believes … Continue reading More Debt-Funded “Stimulus” Ensures Near Zero Real GDP Growth