OUR CONTINUED THOUGHTS ON THE NIGHTMARE RUNNING THE CENTRAL BANK
BY GARY KALTBAUM- MAY 5, 2022
We were apoplectic yesterday when it was reported by the many that Jay Powell is now fighting the inflation, the inflation he mostly created. SAY WHAT? Fighting inflation?
For the zillionth time, we warned you about the most important financial person on earth. We warned you he doesn’t understand what he created and certainly doesn’t understand how to attack the problems he created.
Inflation fighter our —-.
First off, yesterday’s big day…most of the biggest days markets have had throughout history occur during bear markets.
Today…back to reality. Rates are jumping again to new highs as the market realizes JAY POWELL DID NOTHING YESTERDAY TO FIGHT THE INFLATION HE CREATED. Yes…absolutely nothing. The evidence: After yesterday, the man sits fed funds just above 0.75%. As we write this:
The 1 year yield is ever over 2%. The 1 year yielded basically nothing less than a year ago.
The 2 year yield is over 2.7%
The 5 year yield is 3.045%
The 10 year yield is 3.09%
The 30 year yield is 3.18%.
We repeat, the inflation fighter is at 0.75%.
Jay Powell boxed himself in by doing nothing, missing the whole inflation story and now, still doing nothing while it is being reported he is now in the fight against inflation. This is a joke. Jay Powell is now boxed in because he did not fight inflation early when GDP was humming. GDP is now contracting and he is now forced to do what he doesnt want to do. If we took over the Fed today, we would immediately raise fed funds to 2% and take the medicine quickly.
As far as the market, we started warning way back in 21 about all the bubbles that Powell created popping. They have all now popped. They have even taken the megacap tech stalwarts. Next up will be the indices playing catch-up with the average stock that is so much worse than the indices. Next up will be the wealth effect deepening the contraction. (even global bond markets are down $8 trillion) Next up will be housing as the bubble of affordability and now skyrocketing mortgages is a 1-2 punch.
Jay Powell sits at 0.75% and says he has tools. Jay Powell continues to be treated like he knows what he is doing. We take no joy on taking this man on. We would rather be telling you what a great job he is doing. But facts are facts. It is going to get worse.
Powell and the Federal Reserve deserve, and get, a proper review.
Powell and the FED could care less about the Sheeples. Sheeples are just there to be fleeced, as usual.
https://wallstreetonparade.com/2022/05/powell-says-fed-doesnt-have-a-credibility-problem-with-the-american-people-despite-gallup-poll-showing-lowest-confidence-since-2008-financial-crisis/
Who OWNS the Federal Reserve. This is all that matters.
https://wallstreetonparade.com/2019/11/these-are-the-banks-that-own-the-new-york-fed-and-its-money-button/
Gary,
Everyone owes you big time for calling this years ago. I’ve been listening to you every day for a number of years. You always make my ride home enjoyable. Have a nice evening sir!
I agree with this completely.
How then can investors position themselves in the short term and long term sir?