Daniel Lacalle and I discuss Austrian economics, central bank policy, errors by the Fed and ECB, whether or not the inflation is transitory, bank lending, QE, and numerous other topics but not politics in a 1 hour video.
Yes, it’s lengthy but we cover a lot of ground. I have followed Lacalle,@dlacalle_IA, on Twitter for years.
The Fed via asset bubble blowing and encouragement of more unproductive debt has blown another big bubble. When it bursts, the result will be anything but inflationary.
Feedback
@MishGEA: The thing that disturbs me most is #Powell‘s statement keeping #Inflation above trend. Who does that punish? This is financial repression! It punishes those who retire on fixed income, it punishes the poor, it benefits the politically well connected… and the banks…” pic.twitter.com/2AAwXg3yIi
— Harris Samaras (@HarrisSamaras) June 19, 2021
That is precisely what disturbs me most as well.
With no explanation or debate, the Fed redefined price stability as “2%” inflation ignoring exponential ramifications and using very questionable measures of “price” on top of it all!
Adding this Tweet to my post. https://t.co/TLUpNoTYVs
— Mike “Mish” Shedlock (@MishGEA) June 19, 2021
Let’s compare actions by the Bank of China to the Fed.
I specifically note financial repression echoing the sentiment of Michael Pettis in my post The Fed and the Bank of China Both Act to Punish Savers.
Mish
The market is not reflecting the meager economy on main street. At some point it will. Rates will have to rise. Inflation is running hot because prices are connected more to trader speculation in all commodities. The market is out of sync with the economy as it almost always is.
Exaxtly. Deflation on the average over the 50 years lasts only 3 quarters. You have a very short time to buy low before you can sell high😉