Operating at the Intersection of Technology and the Capital Markets
Tag: Federal Reserve
A digital currency world is coming. The 2022 Beijing Olympics will operate via a digital RMB for local attendees and may include digital cross-border payments as well. Our Federal Reserve is experimenting with digital currency. Both Fed Chair Powell and Treasury Secretary Yellen have talked down Bitcoin and said the U.S. will move slowly with … Continue reading Square, PayPal, and Apple Will Dominate A Digital Currency World
If you believe that the Federal Government is an efficient capital allocator you will love Biden's "infrastructure" spending program. Similarly, if you are a "GreenTech" executive or entrepreneur, this massive spending program is shaping up to provide a long-term tail wind. Government officials will have trillions of newly printed capital to play with. Slim chance … Continue reading A Breakdown of Biden’s $2.3 Trillion Green New Deal
It is difficult to imagine a scenario in which the U.S. economy does not experience stagflation. Record debt levels, low labor participation, muted long-term Real GDP growth, persistent inflation and the fact that the Federal Reserve is limited in its options to fight inflation leads us to believe that stagflation is imminent. Our premium TEK2day … Continue reading Stagflation Is ImminentPremium
The Federal Reserve has two primary tools that it may use to fight inflation: halting the printing press and raising interest rates. The first option is unlikely given Treasury Chief Yellen and Fed Chief Powell are operating in lock step. The Fed is limited in its use of the second option. If the Fed were … Continue reading The Fed’s Options To Fight Inflation Are Limited
“Given the low level of interest rates, there’s no issue about the United States being able to service its debt at this time or in the foreseeable future,” - Fed Chair Jerome Powell. Maintaining low rates to minimize debt service expense is top of mind with the Fed as we wrote last week and as … Continue reading Powell Just Told Us Why Interest Rates Will Remain Low
The simple math is that the Federal Government is pumping $1.9 Trillion into the U.S. Economy. Treasury has issued 90 million stimulus payments worth $242 billion. More money in consumers' pockets plus new Treasury bond supply plus relaxing of COVID restrictions translates to higher Treasury bond yields. The higher yields will result in less Technology … Continue reading More Inflation Is Coming
The U.S. Just Passed $1.9 Trillion In Debt-Funded "Relief". Now Is Not The Time For The Fed To Raise Rates. Yield Curve Control Is On The Horizon. Some expect the Federal Reserve to become more hawkish in the near-term. We don't see it. Not with $1.9 Trillion in new Government debt. The Fed will eventually … Continue reading A More Hawkish Fed Is Not In The Cards This Year
"Be careful with me, I'm fragile. I'm easily broken." So go the lyrics to "Trip My Wire", but those words could just as easily describe the frail legacy technology infrastructure that underpins so many commercial processes from home and auto titling to financial trading systems, digital health records, government databases, customer databases and so on. … Continue reading A Better Tripwire Is Not The Answer
Blockchain and a central bank digital currency are two key Fintech areas where the U.S. lags China. Last week we wrote that Distributed Ledger Technologies ("DLT") such as Blockchain are a ripe opportunity for a Public-Private Partnership should the Biden Administration move forward with an infrastructure investment plan later this year or early 2022. Some … Continue reading The U.S. Lags China In Key Fintech Areas
The three-headed Hydra of low labor participation, increased debt levels and higher taxes will cripple U.S. long-term Real GDP growth for decades. Labor participation is not going back to December 2019 levels. To believe that scenario is wishful thinking. For starters, 25% of restaurants and bars are permanently closed. Those jobs are not returning. Second, … Continue reading Brace for Anemic Long-Term Real GDP Growth
