2 replies to this topic

[LMF]

They had Kevin Warsh on CNBC earlier this past week.....I was surprised at how young he looked for a Fed governor.  Of course he didn't get selected over Powell for the top job at the Fed.  But he sounded like nothing I've ever heard before.....I couldn't remember the last time when someone from the Fed sounded like they had real brain power like he did during the interview.  Asked about the 4 trillion balance sheet......its preposterous to have something that bloated this far down the road after the GFC started.  He pointed out the concept of Fed incompetance to date.  Get rid of the balance sheet BEFORE any rate hikes.....the balance sheet was the extraordinary measure, not cutting rates to zero.  Get rid of extraordinary things and then resume normal Fed policy.  And unless you're an idiot, don't even think about doing both at the same time, which the Fed has never done before.  Do no stupidity based on past history.  I was ready to collapse on the floor at this point.  He didn't get the Fed chief job and Powell did?  One of the few Trump screw ups so far, I think.

[slupert]

We bottom Monday or Tuesday, flat Wednesday, bounce day Thursday off the CPI. (JMHO)

[Data]

Both measures are extraordinary. QE is required when you cut rates near zero and hold them there.  The equity has to be extracted from the asset when it doesn't produce enough income or asset appreciation.