Tag Archives: Jay Powell

Rate Hikes, Recessions and the Death of Spiritual Boomerism, by Tom Luongo

Posted on December 19, 2022 | 4 comments

As debt implodes and the economy collapses, many will make their acquaintance with reality for the first time. From Tom Luongo at tomloungo.me:

I hate to gloat but, screw it. I’m gloating. With every FOMC meeting this year, Jerome Powell has become more and more hawkish, but the denial of this still dominates the headlines. He raised the Fed Funds Rate to 4.5% last week, a level unthinkable to nearly everyone, including me, this time last year.

I told you all over a year ago Powell and the Fed were going to war with Davos and the ECB over Climate Change and their push for war with Russia. No one believed me then, and rightfully so. The idea was daft given the Fed’s history, the US’s books and the reality of a “Biden” presidency seemingly hellbent on spending the US into oblivion.

Hell, I barely believed me.

What I did believe was the Fed would be more aggressive than the majority in even the alternative finance space did, what I like to think of as the Zerohedge Set, because I didn’t think Powell was just another garden-variety globalist like his predecessors, Janet Yellen and Ben Bernanke.

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Posted in Banking, Business, Collapse, Currencies, Debt, Economics, Economy, Geopolitics, Governments, Politics, Propaganda, Tyranny

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Central Planners of the World, Unite! By MN Gordon

Posted on September 16, 2022 | Leave a comment

Central banking is Soviet style central planning, and it has worked about as well as Soviet central planning did. From MN Gordon at economicprism.com:

Federal Reserve Chair Jay Powell wants a swift decline in the rate of consumer price inflation.  He isn’t getting what he wants.

According to the Bureau of Labor Statistics, consumer price inflation, as measured by the consumer price index (CPI), increased at an “official” annualized rate of 8.3 percent in August.

This exceeded Wall Street’s consensus expectations of 8.1 percent.  What’s more, it crushed investor hopes a ‘Powell pivot’ would come sooner rather than later.  On Tuesday, the Dow Jones Industrial Average (DJIA) crashed 1,276 points on the news.

Powell, a central planner, wants consumer price inflation to be about 2 percent.  Instead, he’s got something that’s over 400 percent higher.  What’s going on?

If you want to understand what’s up with raging consumer price inflation and Fed monetary policy, you must understand this.  Right now, in the United States as in most of the world, we have a scam currency that’s controlled by central planners.  Specifically, we have what Karl Marx envisioned in Plank No. 5 of his Communist Manifesto:

“No. 5.  Centralization of credit in the hands of the state, by means of a national bank with state capital and an exclusive monopoly.”

The Federal Reserve System, created by the Federal Reserve Act of Congress in 1913, is indeed a privately owned ‘national bank.’  It also holds a monopoly on legal counterfeiting in the United States.

Without the Fed’s policies of mass credit creation, it would have been impossible for the U.S. government to run up a $30.8 trillion national debt.  Without the Fed’s printing press money, the U.S. government never could have run annual trillion-dollar budget deficits for a better part of the last decade and a half.  Without the Fed’s fake money there would not be over 100 million people dependent upon the U.S. government for their daily bread.

This is the miracle of centralized credit.

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The Fed Is Hawkish Now? I’ll Believe It When I See It. By Ryan McMaken

Posted on December 21, 2021 | Leave a comment

Pouring a little less gas on a fire doesn’t make you a fireman. From Ryan McMaken at mises.org:

If you did any Fed watching this week, you probably heard all about how Jay Powell has turned (or perhaps returned) to hawkishness, and how the Federal Open Market Committee is all about fighting price inflation now.

A particularly cartoonish version of this claim was written by Rex Nutting at MarketWatch, who declared, “Everyone’s a hawk now. There are no doves at the Fed anymore.” He wrapped up with “This means that inflation no longer gets the benefit of the doubt. It’s been proven guilty, and even the doves will prosecute the war until victory is won. For the inflation doves at the Fed, Nov. 10, 2021, was bit of [sic] like Dec. 7, 1941: Time to go to war.”

This reads like a parody, so I’m still not 100 percent convinced this writer isn’t being sarcastic. But one will find no shortage of articles making similar claims throughout the financial media—albeit in a less over-the-top fashion.

We’re told about the “Jay Powell pivot” and how the Fed will even soon be “normalizing.” Let’s just say I’ll believe it when I see it. In fact, the evidence strongly suggests the Fed is still of the thinking that only a few tweaks will set everything right again. All that’s needed is a slight slowdown in quantitative easing (QE), and maybe an increase of fifty or a hundred basis points to the federal funds rate, and happy days are here again.

In other words, the Fed is still thinking the way it has thought for the entirety of the twelve years since 2009, when today’s QE experiment began. In that view of the world, it’s never the right time to end unconventional monetary policy. It’s never the right time to sell off assets. It’s never the right time to let interest rates increase by more than a percent or two. Meanwhile, the reality for ordinary people has been one of the weakest and slowest recoveries in history. But the Fed justifies it all to itself because Wall Street is happy.

That’s been the reality for more than a decade. And there are no signs that the Fed is “pivoting” away from that any time soon.

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Hey, Jay, Enough of Your Stinkin’ Easy Money! By David Stockman

Posted on March 5, 2020 | Leave a comment

Whatever you may think the Federal Reserve’s function is—preserve the value of the dollar, promote low inflation and low unemployment, regulate the banking system—it’s real function is to keep stock and bond prices high and rising. From David Stockman at lewrockwell.com:

It doesn’t get any more pathetic than this. The Fed cuts the absurdly
low money market rate by another 50 basis points at 10AM and before noon the
Donald is banging the podium for more.

So if you ever needed a final warning to get out of the casino, today’s
back-to-back eruption of financial insanity from the two most powerful economic actors on the planet should be it.

Even then, we might be inclined to give the Donald a tad bit of slack. After
all, he’s an absolute dunderhead on economics and spent a lifetime as a
leveraged real estate speculator, where, in fact, lower rates are always, but
always, to be welcomed when you’re rolling the dice with other people’s
money.

Still, it doesn’t get any more primitive or dangerous than the Donald’s
current conviction that the price of money should be graduated lower based on
the current year international league tables of GDP growth or the level of presidential braggadocio, as the case may be.

Effectively, however, the tiny posse of fools who run the ECB and the BOJ are
burning down the financial foundations of their own economies. So the Donald
insists we burn down ours, too.

Folks, that’s the sum, substance and full extent of his “thinking”:

“As usual, Jay Powell and the Federal Reserve are slow to act. Germany
and others are pumping money into their economies. Other Central Banks are much more aggressive,” Trump said, referring to the Fed chairman.

“The Federal Reserve is cutting but must further ease and, most importantly,
come into line with other countries/competitors. We are not playing on a level field. Not fair to USA. It is finally time for the Federal Reserve
to LEAD. More easing and cutting!”

By contrast, the empty suite and sniveling coward who announced today’s
emergency 50 basis point cut deserves no quarter whatsoever. The man is so petrified of a hissy fit by the boys, girls and robo-machines in the trading pits that he has just plain abandoned any pretense of rational financial thought.

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What Could Go Wrong? by James Howard Kunstler

Posted on November 6, 2017 | Leave a comment

To answer the title question: plenty. From James Howard Kunstler at kunstler.com:

Everybody and his uncle, and his uncle’s mother’s uncle, believes that the stock markets will be zooming to new record highs this week, and probably so, because it is the time of year to fatten up, just as the Thanksgiving turkeys are happily fattening up — prior to their mass slaughter.

President Trump’s new Federal Reserve chair, Jerome “Jay” Powell, “a low interest-rate kind of guy,” was obviously picked because he is Janet Yellen minus testicles, the grayest of gray go-along Fed go-fers, going about his life-long errand-boy duties in the thickets of financial lawyerdom like a bustling little rodent girdling the trunks of every living shrub on behalf of the asset-stripping business that is private equity (eight years with the Deep State-ish Carlyle Group) while subsisting on the rich insect life in the leaf litter below his busy little paws.

Powell’s contribution to the discourse of finance was his famous utterance that the lack of inflation is “kind of a mystery.” Oh, yes, indeed, a riddle wrapped in an enigma inside a mystery dropped in a doggie bag with half a pastrami sandwich. Unless you consider that all the “money” pumped out of the Fed and the world’s other central banks flows through a hose to only two destinations: the bond and stock markets, where this hot-air-like “money” inflates zeppelin-sized bubbles that have no relation to on-the-ground economies where real people have to make things and trade things.

Powell might have gone a bit further and declared contemporary finance itself “a mystery,” because it has been engineered deliberately so by the equivalent of stage magicians devising ever more astounding ruses, deceptions, and mis-directions as they enjoy sure-thing revenue streams their magic tricks generate. This is vulgarly known as “the rich getting richer.” The catch is, they’re getting richer on revenue streams of pure air, and there is a lot of perilous distance between the air they’re suspended in and the hard ground below.

Powell noted that the economy is growing robustly and unemployment is supernaturally low. Like his colleagues and auditors in the investment banking community, he’s just making this shit up. As the late Joseph Goebbels used to say describing his misinformation technique, if you’re going to lie, make sure it’s a whopper.

To continue reading: What Could Go Wrong?

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