Stuck in Glue
The Fed is stuck in glue. It did not change interest rates. Nor did it change much of its announcement as the WSJ Fed Statement Tracker shows.
No Dissents
Sarcastic News of the Day
Effective Lower Bound
For discussion of the Effective Lower Bound (the point at which lowering rates further is counterproductive), please see:
- June 4, 2019: Powell Ready to Cut Rates to “Effective Lower Bound” via “Conventional” Policy
- September 25 2019: In Search of the Effective Lower Bound
Two Inflationary Tail Risks For US Investors
The Fed is stuck and will not lower rates below zero nor can it raise them without killing housing.
For discussion please see Two Inflationary Tail Risks For US Investors
Meanwhile, the bubbles keep getting bigger increasing the odds of a deflationary collapse.
Mish
Country can’t afford higher rates. It would kill the economy, which is pretty sad when you consider what this is doing to savings. The “greatest economy in the world” can’t afford to borrow at 5%! What a joke.
As for the Trumpturds here with their sad conspiracy theories, you can fuck off. If you don’t like democracy and voting, there is a long list of shit hole countries you can go to and be racist, ignorant and xenophobic while living under a lovely dictatorship.
These are the kind of write-ups I’ve been missing since the focus was moved to the election….hopefully the trend continues.
“If not, he has lots of (awful for the country) Constitutional options, with the first one being to make an appeal to the state legislatures in WI, PA, GA and AZ, which are entirely GOP-controlled.”
Understand the theory and it was also on Fox News.
Don’t believe so
He’s clearly lost now. Hope he moves on for everybody’s sake.
But he’s never shown himself to be the type of guy to do that.
So… once Trump loses the vote counts, do people think he concedes?
If not, he has lots of (awful for the country) Constitutional options, with the first one being to make an appeal to the state legislatures in WI, PA, GA and AZ, which are entirely GOP-controlled.
Seems like they can choose the electors they want, regardless of the vote (correct me if I’m wrong).
The only remedy is for Congress to discard that state’s votes, but then neither candidate has a majority and the vote goes to the House delegations for a vote (and those are marginally GOP-controlled).
I think we all know Trump would try this if he thought he could pull it off.
Anybody think any of those 4 state legislatures would go along? And if so, what about the House GOP members afterward?
also, NYT reporting, “Joseph R. Biden Jr. won three of Maine’s four electoral votes.”
I thought Trump had lost Maine’s 2nd district.
PA: Biden takes 63% of 5,487 batch of unknown origin. Trump lead falls further to 22,571.
GEORGIA SEC OF ST – Said that 16105 votes left to be counted.
GA: 34 new ballots. 82% Biden. Net 22. Trump lead 1,775.
This means Biden needs 55% of remaining votes to hit lead.
He will want 65% to feel comfortable covering off any military or other provisional votes still to be counted.
He’s tracking at over 70% today. #Georgia
Arizona Math
Farewell on Deck
Nate Cohn on Georgia
Nate Cohn NYT: Trump’s lead in Georgia now under 4000 votes after Chatham absentees report.
Might still be about 20000 votes left throughout the state, based on the earlier tallies from the secretary of state. Hard to think Biden wouldn’t find another 3700 votes
How much did you bet? Asking for a friend.
John Williams alternate CPI (1980 base) broke 9% in September. I haven’t followed him closely in recent years but I thought it might be interesting to check.
Not much I was on predictit and the max bet was $850
I got Biden at $0.16
Do the math on that.
Cashed some of that out and blew it on a VP pick
But I won a bet on Biden winning a state Trump won.
I have several hundred (again peanuts) on Georgia being the tipping point state. Average cost $0.10 or so
As far as John Williams goes, I believe he is a hyperinflationist clown.
I quit reading him some years back after being convinced that your definition of inflation was the only one that made sense to me…..but in these times when M2 has spiked so much, I wanted to see if his alternate CPI was spiking along with it.
It’s just that on consumer prices…..right now does look a lot (to me anyway) like post-bailout 2008, when certain necessities jumped a lot in price even though measured CPI wasn’t showing it.
On the price side as a consumer I see fuel costs running low….. but housing, food, and healthcare continuing to go up a lot. I’m finally past the tuition years, so that one is not on my radar anymore.
Stocks and real estate seem to have spiked, of course……gold and even crypto look to have started new bull markets. Just signs to me that remind me of the early part of inflationary periods.
My hedge is Austin residential RE, and it seems to be working fine…..but I just look for signs…not of hyperinflation……but of seriously higher than reported inflation…..which it seems to be reasonable to expect with all the helicopter money.
It would be interesting to know how much of the “helicopter money” turns out just to be new debt creation……in my own case it will probably end up that two thirds of my “bailout” will be long term debt (albeit at low interest). I haven’t applied for PPP forgiveness yet. That one, if not forgiven, has onerous terms.
Another real lockdown could still be catastrophic for us..if that were to become necessary…..we haven’t even adjusted to the new normal, because we’re still in grace.
I expect more and bigger bailouts by the time Biden takes office…..maybe much bigger….it looks like the economy is in one of those Wiley Coyote moments….we have a very big shoe that it going to drop soon.
Since 2008 personal debt has gone up a lot, but it’s being serviced fine , or was until recently , and people still have access to credit…..that’s what’s taking up the slack at the moment….
I’m just trying to read the tea leaves, like I alway have…..I appreciate your insights into inflation as much as anything you write about.
The Fed is now almost totally irrelevant. The only “tool” they have left is their printing press. And they will continue to use it.
Well they have to have something tangible on their balance sheet, confiscated bitcoins next maybe ?
Alec
@AlecMcQuade
·
17m
Chatham Co. just reported nearly all of its 17K. Biden received 11,148. Trump 5,587. That shrinks Trump lead in Georgia to 3,635. #Elections2020 #11Alive
Niels Lesniewski
@nielslesniewski
While President Trump was speaking, his lead in Georgia fell to 3,645 votes.
All roads lead to Rome, circa 275 AD right about now.
More like 133 BC
Nate Cohn Projection – Excellent News if True
Champagne is ready……
Georgia
Nevada
So close.
“Democratic-leaning Chatham County (home to Savannah) in GA has finished counting the roughly 17K votes that was outstanding earlier today, which made up for a big chunk of the state’s outstanding ballots. Trump lead in GA is now at under 10,000 votes.”
My understanding, an hopefully so is these were “counted” but “not reported”
But that is from a random Tweet of unknown accuracy.
The Feds Seized $1 Billion in Stolen Silk Road Bitcoins
A hacker identified only as Individual X had been sitting on a cryptocurrency gold mine for seven years before the IRS came knocking.
Print, Jay, Print……Buy everything.
Didn’t the Fed already say that rates would remain unchanged until the end of 2023 at the earliest? I expect that date to be pushed back since they previously stayed on zero for eight years.
To say they’re stuck is an understatement. The only way their prediction is broken is if we go negative.
Loved the piece Mish. I agree 100%. No chance the Fed increases rates. If they raise rates they also shoot themselves in the foot in terms of debt service payments. I dont think there is any chance they raise them for a long time
Keep on Printing J-Powell, digitally of course because of climate change.
We are in an MMT world now and I don’t think either party is going to fight it for the moment or if indeed should they considering the damage done by Covid-19. Putting it back into the bottle is going to be the major theme in about five years.
if editing was there and is now gone – then due to being forced to turn off posting again, the two are related.
Another attack on my website
Sports betting and sports promotion sites sending hundreds or even thousands of links. Do not know the count. They are autodeleted.
This has been going on for several days causing frustration for everyone.
In response, spam filter also affecting legitimate comments. I undelete them when I see them.
Do not submit comments twice if they disappear. It’s extra work on me.
Apologies offered.
Mish
Appreciate your efforts. I have a certification in cybersecurity and understand the pain of DoS and other attacks. I suspect some of these are coming from Russian-run farms given the attacks seem to have started on election day or just prior.
I think the Fed would take their foot off the pedal if they thought a stimulus and infrastrucure package would get done but with the senate staying republican i don’t see it
Have you followed McConnell statements the last 2 days?
I think the covid relief bill is a whole new ballgame.
This time Pelosi and McConnell will put together a large bill that passes. And Trump might be the bottleneck… I wonder if they’d have the votes to override a Trump veto.
As someone that is doing ok without help, this would be fun to watch.
Doesn’t work that way. The Fed would need to monetize the debt needed for the fiscal spending in order for it to have much effect on the economy.
Steven Van Metre and Jeff Snider on why what the Fed is doing is wrong.
Please view, one and all, and if you agree, please let’s bombard out US Congress Representatives and Senators repeatedly until something changes. Thank you.
Trump and aides have had discussions about mounting a comeback run in 2024 should he lose reelection to Biden, an adviser tells me. No word whether he would do it. But the subject has come up https://twitter.com/Acosta/status/1324427747540828162
There won’t be anything left of him to run after the loans come due and the lawyers finish with him.
Expect Trump to exhaust all legal options first. He may never concede, and complain about how the election was stolen from him over the next 4 years, fueling conspiracies along the way.
But he’s not going to go down without a fight– he may have more than a few legal issues over the next couple of years that would prevent him from running again.
Think that this isn’t going to be over when they’re done counting the votes. They installed that unscalable fence around the WH for a reason…
Sitting in that building isn’t what gives him power.
So this is how the democracy ends.
the republic
Better make haste on the indictments.
Trump will be bankrupt soon after January 20th and Deustch Bank will seize his properties where they can. He has been making interest only payments for nearly a decade. Additionally SDNY has a case sitting on their desk ready to file for tax fraud on the entire Trump organization and individuals and they will owe back taxes, penalties and interest. I fully expect jail time for Trump before his life ends.
I can see having to go Branch Davidian on his ass. Get Janet Reno stat.
Cant run for president with a felony conviction. I think
Maybe his tax returns will be available for every one to see by then.