That Didn’t Take Long

So much for the Donald’s “come home to Jesus Moment”.  He went back to his old ways the next day.  No doubt his high ego need is focused on how to get his poll numbers out of the 30’s and up to the 60’s where his screwed up mind lives.  So he went back to his base and talked looney talk, and they loved it. Yes in the 21st century the attempt to build a wall is still on his mind.  It might make more sense to build a wall around the White House and not let him out.

Jackson Hole and Inflation

Long time readers of this blog know that I believe the Fed’s QE2 and QE3 policy sent the wrong message to the economy and the people, and even worse, it sent the wrong message to Global central bankers.  It basically signaled that speculators will be able to do dumb things with cheap money, forget trying to do smart productive things that would bring about real growth.  Paper assets benefited.

So now we sit in the conundrum of what will happen when they wind down balance sheets around the world.  This process is the most important first step before raising Fed Fund rates to a more normal 4-5 %.  The world has no idea of what normalization will bring, but if Central Bankers really want to increase growth they need money to be priced so that it will be used to produce real not speculative numbers.

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