From Printer go BRRR to Printer go SHHH..

Jun 01, 2022

President Biden summoned Fed President Jerome Powell to the principals office yesterday for a rare public spanking (sorry, meeting), for him to answer why inflation is soaring, proffer a solution and most importantly, take the blame wholeheartedly. Since the November midterms are around the corner, it is only evident that Jerome Powell’s new mandate is to be of service, to who is a good question.

So from pivoting from 'its Putin’s fault', to 'its Jerome’s fault', Mr. Brandon (I mean Biden) has forgotten (pardon his old age) that that he was the one voted into the office “to get things done.”

A recent Gallup’s poll has measured the public’s confidence in the economy to be as low as -45 in May, almost reaching to dire levels similar to GFC in 2008.

This pessimism isn’t looking to good for the administration and the elections. With a possible looming recession, we are off to a rocky H2 2022 and maybe a catastrophic loss for the democrats.

Away from market update, a looming famine will herald social unrest so one understands why the administration is desperate to do something or seem like its doing something.

Pivoting back to the markets, where Mr. Biden is an expert in shifting goal posts, we witness the superpower of the Fed to kick the can down the road instead of addressing the root cause. So we expect QT until something breaks.

unusual_whales@unusual_whales

The Fed starts Quantitative Tightening (QT) tomorrow. It will process $47.5 billion a month for the first three months. It will increase to the full $95 billion three months later. They are trying to reduce their balance sheet by $7.6 trillion by 2023 end. (Uh, oh).

8:18 PM · May 31, 2022

684 Reposts · 3.52K Likes

This Inflationary period has been exacerbated by:

Europe’s a self-imposed energy crisis.
China’s self-imposed lockdown problem.
Japan’s self-imposed currency devaluation.

The DXY has been shooting up, meaning foreign sector has trouble buying Treasuries. So, most assets go down including our beloved crypto market (expect more downtrend).

Lyn Alden@LynAldenContact

Asset prices and GDP estimates get weird, therefore, until a pivot occurs. Due to Fed mandates (control inflation at the cost of employment), the pivot occurs only when something in financial markets breaks. So, things get bad -> things break -> policy reversal.

5:48 PM · Apr 25, 2022

46 Reposts · 717 Likes

Seasoned economist Mohammed El-Erian tweets questioning why the Fed got it so wrong, something that Gold bugs and Bitcoiners have been yelling since printer BRR.

Mohamed A. El-Erian@elerianm

Belated #Inflation pivot #Fed Chair #Powell speaks "directly to the American people" stating "Inflation is much too high, and we understand the hardship it is causing, and we're moving expeditiously to bring it back down" No mention yet of why the Fed got it so wrong for so long

6:36 PM · May 4, 2022

110 Reposts · 611 Likes

We have two options for how things we eventually materialize.

ＤＲＥＡＤＢＯＮＧＯ@DreadBong0

You are in one of two camps.. Camp 1 - You believe the Fed will not raise rates like they say.. Pivot, let inflation run hot for foreseeable future Camp 2 - They'll raise rates like they say.. Keep going until they shit breaks, crushing the market in process to curb inflation

5:01 PM · May 31, 2022

4 Reposts · 33 Likes

Am in the second camp but I don’t think they have the courage to go through with stated hikes of 75bps but most likely with the 50bps then wait until something breaks and voilà, policy U-turn.

In the meantime, BTC is seeing a bear rally and peeked above $32k yesterday..