The 2020 Covid outbreak and the ensuing authorities shutdowns and faculty closures begat a Washington DC spending spree and Federal Reserve financial stimulus barrage in contrast to something different time in historical past. Congress and Administrations like to spend different folks’s cash, however as Rahm Emanuel as soon as stated “You by no means let a critical disaster go to waste. And what I imply by that it’s a possibility to do stuff you assume you possibly can not do earlier than” And wow, did they ever binge spend and increase the M2 Cash provide. I name it “The Nice Dislocation” of the financial system and we by no means recovered from it.
Or as Ray Wylie Hubbard sang, “Ingesting with my low life companions, dancin’ with a girl who will not be my spouse.” This ought to be the theme tune for Washington DC and their manic spending.
However after the large spending splurges and Fed financial stimultypto, The Fed lastly began withdrawing “the punch bowl” to fight inflation. M2 Cash development year-over-year (YoY) is now 0%. And with inflation, US common weekly earnings development YoY turned negativc and has been unfavorable for 21 straight months.
After the spending explosion below Pelosi/Schumer and Powell’s financial, M2 Cash velocity (GDP/M2 Cash) crashed to it lowest degree in historical past. So now we’ve depressed cash velocity and no M2 cash development. And the US nonetheless has 21 straight months of unfavorable weekly earnings development.
However former Fed Chair and present Secretary of Treasury Janet Yellen is happy that inflation is FINALLY slowing which Yellen attributes to enjoyable provide chains. Or is it declining M2 Cash development, Janet?
Now that the Federal authorities’s spending spree and The Fed’s financial stimulypto dislocated the US financial system, we’re headed for a recession with no ammunition left in The Fed’s arsenal.
In any case. The Federal Reserve has been destroying shopper buying energy since 1913. And we could also be on the finish of The Fed’s financial rope.
Even worse, we’ve Joe Biden as President, who curiously has been discovered to have categorized paperwork in his possession from when he was Vice President, at the least, at two places (his Wilmington DL house that his son Hunter had entry to and the now notorious Penn Biden Heart in Washington DC). Even worse, Biden appears to be speaking to lifeless world leaders like Germany’s Schmidt and France’s Mitterand.
Figuring out Biden’s penchant for blatant mendacity and carelessness, I wouldn’t be shocked if this can be a stack of categorized paperwork on the desk throughout his assembly with Treasury Secretary Janet Yellen.
Let’s hope Biden isn’t saying that he’s speaking to late Robert Kennedy, the previous US Legal professional Normal.
