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It’s been so long since the Fed did this. The Fed that most investors know is the one that always props up stock prices whenever it gets a whiff of a bear market. But with inflation running at 7.1% for the past year, the Fed is back in full Paul Volcker mode. At least, that’s what Powell wants us to believe.
The COVID recession was the first downturn in history that left most people richer than they had been before. Congress pumped trillions into household and business bank accounts. The Fed pumped trillions into reserve balances, and some of that sloshed into financial markets. And the world of crypto created trillions more out of thin air, the ultimate fiat currency.
Fiscal policy supported the incomes of the working class while the full faith and credit of the Federal Reserve stood behind the portfolios of the investing class. Everyone felt richer and they spent like it.
The “problem” of too much money is being solved, even before the first increase in interest rates.
https://www.marketwatch.com/story/hidden...=home-page
The COVID recession was the first downturn in history that left most people richer than they had been before. Congress pumped trillions into household and business bank accounts. The Fed pumped trillions into reserve balances, and some of that sloshed into financial markets. And the world of crypto created trillions more out of thin air, the ultimate fiat currency.
Fiscal policy supported the incomes of the working class while the full faith and credit of the Federal Reserve stood behind the portfolios of the investing class. Everyone felt richer and they spent like it.
The “problem” of too much money is being solved, even before the first increase in interest rates.
https://www.marketwatch.com/story/hidden...=home-page
