Tag: M1

The Delusional Fed

The Delusional Fed

The Fed's economic projections coming out of last week's FOMC meeting are far too optimistic. Fed's Real GDP projections for 2022, 2023 and 2024: 1.7%, 1.7% and 1.9% respectively. 2022 is going to be a zero percent to down Real GDP year in our view. 2023 will be flat with 2022 in our view. 2024 … Continue reading The Delusional Fed

Tomorrow’s Fed Decision

Tomorrow’s Fed Decision

We expect a 50 basis point increase in the Fed Funds rate tomorrow. More importantly over the next number of months will be the Fed's actions with respect to its balance sheet. Our focus will be on the Fed's balance sheet over the next number of months (see chart below), which has ticked down recently … Continue reading Tomorrow’s Fed Decision

Multiple Fiscal Stimulus Rounds Are Coming. Good News for Equities. Bad News for The Real Economy.

Multiple Fiscal Stimulus Rounds Are Coming. Good News for Equities. Bad News for The Real Economy.

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.

Mustn’t Worry. A Fiscal Deal Is Coming.

Mustn’t Worry. A Fiscal Deal Is Coming.

Make no mistake, another fiscal "stimulus" deal is coming. Politicians won't pass on the opportunity to "rescue" the U.S. economy while funding a variety of pet programs in the process. Republicans and Democrats are undoubtedly haggling over the amount and nature of the pork that will be included in the next debt-funded stimulus stew. We … Continue reading Mustn’t Worry. A Fiscal Deal Is Coming.

More Debt-Funded “Stimulus” Ensures Near Zero Real GDP Growth

More Debt-Funded “Stimulus” Ensures Near Zero Real GDP Growth

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