Fed Will Cause a 2008 Redux

Truth is a rare commodity on Wall Street. You have to sift through tons of dirt to find the golden ore. For example, main stream analysis of the Fed’s current monetary policy claims that it will be able to normalize interest rates with impunity. That assertion could not be further from the truth. The fact is the Fed has been tightening monetary policy since December of 2013, when it began to taper the asset purchase program known as Quantitative Easing. This is because the flow of bond purchases is much more important than the stock of assets held on the Fed’s balance sheet. The Fed Chairman at the time, Ben Bernanke, started to reduce the amount of bond purchases by $ 10 billion per month; taking the amount of QE from $ 85 billion, to 0 by the end of October 2014.
The Market Oracle

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