Talking out of Both Sides…

We have all heard the term, talking out of both sides of your mouth. That is what we have seen in Washington for years, especially after Bernanke juiced the plot in 2011 with QE.

That fact is money is the driver of the stock market, whether it be in the form of earnings or just money the government throws around by buying government bonds or managing the money supply. So, Moody’s says things are bad in the U.S. debt environment. What is new?

It is obvious that Trump is not really going to cut the deficit regardless of his talk. The Fed money supply numbers made a new high in March 2025 after a decline between March 2022 and October 2023. Trump keeps yelling at Powell to ease up, he is easing up, Fed Funds under 5 percent are not high.

There will be a moment of truth, but it hasn’t hit Washington yet.