The market is currently betting heavily on the FOMC delivering another rate cut in December, and considering the real goal of the Fed and fellow central bankers has been to “assure financial market stability”, not control inflation, assure healthy and homogeneous economic growth, or maintain a resilient job market, it…
Category:FED
WHY, INSTEAD OF FIXING US PROBLEMS, FED RATE CUTS WILL WORSEN THEM
Exactly one year ago, a parade of “experts” was making the rounds on various popular TV networks advocating for a 75 basis point emergency FED rate cut to troubleshoot the crisis in the global JPY carry trade scheme. At that time, traders in the futures market priced a 60% probability…
PLAYING WITH FIRE: TRUMP DANGEROUS PUSH FOR LOWER INTEREST RATES
There is no day now when we do not hear from either Lutnick, Bessent, or Trump himself a verbal broadside towards the Federal Reserve, where, let’s not forget, Donald Trump himself nominated the chairman. Why so much beef against Jerome “Burns” Powell? According to them, the FED should be cutting…
2025 FED STRESS TEST REVEALS HOW TODAY’S FED IS COMPLICIT IN HIDING BANKS’ PROBLEMS
The Federal Reserve just released the results of its 2025 round of stress testing on 22 major US banks, and personally, I have never come across something more ridiculous and hypocritical. Let’s start with the fact that the FED itself admits how it found it appropriate to make this year’s…
STRAP ON FOLKS, BOND VIGILANTES ARE NOW IN THE DRIVING SEAT!
Back in August last year I wrote the article “IF THE FED CUTS RATES, THE DAMAGES WILL BE FAR GREATER THAN THE BENEFITS” to deliver the following warnings: “To all those who advocate rate cuts because those will benefit the economy, I dare to ask where exactly the economy will…
ARE WE 24 HOURS AWAY FROM A FED SURPRISE RATE CUT?
Right now, the futures market is pricing only a 2.7% probability of seeing the FED delivering a 25bp rate cut in the upcoming meeting. Considering the overall economic situation, my personal view is that the FED should be tightening financial conditions further, not the opposite. However, while US inflation remains…
WITHOUT THE FED RESUMING QE, THE US WILL FACE A DEBT CRISIS VERY SOON
If foreign countries and companies are going to have less USD going forward, who is going to buy US debt? These past few days, I have been paying close attention to the narratives and dynamics developing around the tariffs war topic, but somehow nobody has brought attention to the crucial…
THE CENTRAL BANK “KING” IS MORE AND MORE “NAKED”
“Why are central banks cutting rates while yields are going up? How is this possible?” This is the question many people are asking themselves at the moment. Surprisingly, those experiencing the highest degree of confusion and bewilderment appear to be institutional investors rather than retail investors. The reason is that…
HOW A FIAT CURRENCY SYSTEM DIES OF A THOUSAND CUTS
The result of the US elections should have rung warning bells everywhere in the world, but apparently, it didn’t. Europe, Canada, Japan, South Korea – the list of economies that persist in feeding asset bubbles is long. The US is still part of it, considering the market is forcing (sorry,…
BRACE FOR IMPACT: WHY MARKETS MAY FACE A VOLATILITY STORM AFTER THE 2024 US ELECTION
Finally, here we are with only one day left until the end of the most tragicomic US Presidential campaign ever. So far, investors do not seem too concerned about it, considering the shape of the VIX curve. Yes, some have put some hedging in place, but as you can see,…