I have found credit spreads weird too. Because the Fed bought credit in 2020, does it mean you cannot rely on it anymore? Maybe it never sells off because credit investors are discounting the Fed stepping in again on any weakness? Using your political analysis, will the Fed go back to buying credit again? Will they buy equities, like in Japan?
I am trying to assess the politics of Fed intervention today, whether anything has changed. Is it like before, were the Fed gets the bazookas out in a heartbeat(?) Or is it more nuanced now, where Fed buying is seen as regressive, helping the rich, hurting the poor though inflation and wealth inequality. Don't know the answer.
i read the project 25 pamphlet during hols and on pages 732ff on fed policy, kevin warsh is exactly executing acc to Paul Winfree's script, ironically, this guy was now nominated by KW as interim advisor, it's more than rate hikes/downs, it's about structural changes and possibly harming fed in a way to discredit this institution and leave to bond market in terms of yield setting
I have found credit spreads weird too. Because the Fed bought credit in 2020, does it mean you cannot rely on it anymore? Maybe it never sells off because credit investors are discounting the Fed stepping in again on any weakness? Using your political analysis, will the Fed go back to buying credit again? Will they buy equities, like in Japan?
Maybe... but should end up reflecting higher government bond yields or.higher gold.price
I am trying to assess the politics of Fed intervention today, whether anything has changed. Is it like before, were the Fed gets the bazookas out in a heartbeat(?) Or is it more nuanced now, where Fed buying is seen as regressive, helping the rich, hurting the poor though inflation and wealth inequality. Don't know the answer.
I think politically they have been seen to bail out... so less reluctant now... especially as bond markets are skittish
i read the project 25 pamphlet during hols and on pages 732ff on fed policy, kevin warsh is exactly executing acc to Paul Winfree's script, ironically, this guy was now nominated by KW as interim advisor, it's more than rate hikes/downs, it's about structural changes and possibly harming fed in a way to discredit this institution and leave to bond market in terms of yield setting
Bear case for me is 10% correction between now and 18 Sept. Buy the dip rebound for mid terms but 30% sell off post mid terms longer downturn
I admire the precision of this call!