Powell: U.S. No Longer Needs Aggressive Stimulus

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Yeah no kidding. The fed needs to shift from managing market performance to managing inflation. The market is overheated now, and a correction will be more painful than it had to be. The business world figured this out 6 months ago when they started passing along price increases on imported goods (corrected typo), as raw material and supply chain driven costs showed no sign of cooling down as many suggested they would.


So, all the fed governors and their friends and their previous and future colleagues have unloaded their portfolio? Nice, let’s hike the rate


I ask myself how the Fed can decrease the money in the economy without destroying the middle and lower class. Obviously most of the money the rich got, went into the stock market and offshore. How can you get money out of offshore accounts and at the same time out of the stock market without crashing the economy? Impossible.


What the US needs is wage correction. Wages have failed to keep pace with the real cost of living for so long now, that it is becoming increasingly impossible for a full time wage earner to afford even basic necessities like food, shelter, and transportation, let alone long term life needs like healthcare and higher education. It’s a recipe for disaster that all of us can see from miles away, and we’re rushing headlong into it because our policy makers are solely concerned with protecting the interests of asset owners.


I’m somewhat optimistic by Powell, which I know will be a minority. The bulk of the inflation wasn’t due to monetary side issues so I think Powell is setting it up for the Fed to hike rates more but won’t end up doing so. Instead they will try and tight rope harming demand and taming inflation. We will get QE tapering and rate hikes but not 4 or 5 hikes.