I can't drive 55
Currently cutting a sweetheart deal with PIMCO to get managing director rank and partner status, allowing me to share in the firm's profits.
Re: Today’s title
So anyway, everyone is celebrating a 4.9% CORE PCE number today. (PCE, or Personal Consumption Expenditures, is an effort to understate the already grossly understated CPI).
The last time this model hit 4.9% on the way up was in December 1970. If you add back in food and energy, both of which I use, regular old PCE inflation is now 9.2%.
Back in December 1970, the Fed Funds rate was at 3%, not sub-1%. We now know what happened next.
Pimco Intern Ben Bernanke on 60 Minutes in 2010 What hubris this guy has.
Pelley: Is keeping inflation in check less of a priority for the Federal Reserve now?
Bernanke: No, absolutely not. What we’re trying to do is achieve a balance. We’ve been very, very clear that we will not allow inflation to rise above two percent or less.
Pelley: Can you act quickly enough to prevent inflation from getting out of control?
Bernanke: We could raise interest rates in 15 minutes if we have to. So, there really is no problem with raising rates, tightening monetary policy, slowing the economy, reducing inflation, at the appropriate time. Now, that time is not now.
Pelley: You have what degree of confidence in your ability to control this?
Bernanke: One hundred percent.
“Former Fed-Chairman Ben Bernanke once tried to reassure everyone that the Fed could raise rates in 15 minutes if it wanted to. Well, it turns out the Fed cannot do that. So, it’s a brave new world we’re living in.” - Jim Grant
These guys are good:
"Staff economists at the Federal Reserve predict...a measured inflation rate of slightly less than 2% in 2022, according to minutes of the September Federal Open Market Committee meeting released last Wednesday." - via @Grantspub, October 2021
"The Federal Reserve simply does not understand the risks of asset price bubbles and asset price collapses. It is clear from the data they don’t get it." - Jeremy Grantham
I hear a lot lately about how the poor Fed can’t control inflation caused by Putin/Supply Chains/Sunspots etc., and that may be sort of true, but the Federal Reserve has been spraying gasoline over financial markets for over a decade now, so don’t act surprised when a few matches get dropped. (Check out Dick Fisher in 2016!)
The Fed has seriously f’d with price discovery for years, creating another historic asset bubble, and massively spiked wealth inequality (and prices) with their ZIRP and QE experiments.
In addition, almost every single thing the Fed and U.S. government have done this century has been designed to encourage more non-productive debt (ask Lacy Hunt about that.)
The Fed is the systemic threat.
Turning Japanese: New York Fed Stuns with New Report: At Year End Its Trading Desk Owned 38 Percent of All 10-30 Year U.S. Treasuries. Again, you must follow WallStreetOnParade.com. Their tiny operation delves more thoroughly into the too-big-to-jail gangsters running America than anybody.
Stephen Roach: Fed Is "Delusional", Powell Is No Volcker This is pretty much what I was trying to say with “So Hawkish It Hurts”.
Speaking of Monkeypox, which is coming for all of us, I am reminded of the pre-Iraq War II smallpox scare. Media Roots Radio has several podcasts on the topic.
“Egon Durban, the co-Chief Executive Officer of private equity firm Silver Lake, will remain on Twitter Inc.’s board of directors despite failing to receive enough votes for re-election at the company’s annual shareholder meeting on Wednesday.” So what was the point of the “election”?
“Twitter asked users for personal information for the express purpose of securing their accounts, but then also used it to serve targeted ads for Twitter’s financial benefit. It wasn’t Twitter’s first alleged violation of the FTC Act, but this one will cost the company $150 million in civil penalties.” But I get banned.
Saw this: Inflation Fears Greatly Exaggerated, According to the bond market, to which I would respond, “You mean the same bond market where $30 trillion of debt has been de facto monetized by central banks? That bond market?” (See Goodhart’s law)
Experts warn the Fed is ready to raise rates as high as 5% Also, I might win the Heisman Trophy.
Russian default just ‘a matter of time’ after Biden blocks bond payments “US banks and individuals are banned from receiving bond payments from Russia” Did we do this to the Saudis after 9/11? I forget.
October 2-4, 2001: Senators Daschle and Leahy Raise Concerns about Newly Introduced Patriot Act
October 15, 2001: Senators Daschle and Leahy Are Targets of Anthrax Attacks
October 24, 2001: House and Senate Pass Patriot Act Without Reading It
Random quotes…
"Everything we've kept at bay for decades, it's all being discussed openly, as an actual option." - Saul Berenson
“The truth isn't much good if no one will listen." - Saul Berenson
"This is Vietnam, except the media is in McNamara’s pocket." - Alex Berenson (with Grant Williams and Bill Fleckenstein in 2021)
"Bad men need nothing more to compass their ends, than that good men should look on and do nothing." - John Stuart Mill, 1867
"Many of our intellectuals...have accepted the principle that a book should be published or suppressed, praised or damned, not on its merits but according to political expediency." - George Orwell, "The Freedom of the Press," 1945
"Each of the sentences I write is trying to say the whole thing, i.e. the same thing over and over again; it is as though they were all simply views of one object seen from different angles." - Ludwig Wittgenstein, 𝘊𝘶𝘭𝘵𝘶𝘳𝘦 𝘢𝘯𝘥 𝘝𝘢𝘭𝘶𝘦
Thanks for sharing Herr Havenstein,
We have a Yorkie. He's rescue dog, so like all of them, he's weird AF (we've had 5 or 6 rescues, so obviously, that makes me an expert). Anyway, he likes a few thick slices of cucumber in the evening, and I'm fortunate enough to be able to absorb the 23% increase in his snack of choice. I'm pretty sure that's higher that 4.9%.