Trump has the opportunity to fill more seats on the Fed’s board of Governors than any president since then. His influence goes further than that, however.
My take is that the Fed is desperate to raise rates before the next recession — so they can cut them again — and will take every opportunity to do so.
The biggest financial story in the world today is not Fed policy or emerging-market debt. The biggest story is the global US dollar shortage.
China is now embroiled in an internal political struggle around the efforts of President Xi to make himself the most powerful Chinese leader since Mao.
The metaphor of Ice-Nine is that it spreads from molecule to molecule, institution to institution, requiring a freeze on the entire financial system.
What snowflake could precipitate the next financial panic? Deutsche Bank is an obvious candidate. Less obvious is a failure to deliver physical gold by a London bullion bank.
Trump claimed that Yellen was keeping interest rates artificially low in order to pump up the stock market and help elect Hillary Clinton.
The Fed has said they’re on track to raise three times this year. The market doesn’t believe it. The market is counting on maybe two rate hikes at most.
These trends will continue until the aims of the ‘Axis of Gold’ have been achieved. The overthrow of the US dollar as the benchmark global reserve currency.
Fed forecasting is surprisingly easy. It’s a matter of considering what we know and what we don’t know, and observing the indications and warnings.
Goodfriend’s focus was to promote ‘unencumbered’ negative interest rate policy, which means getting rid of things standing in your way.
Trump’s big spending plans and animal spirits could produce the inflation while Yellen’s rate hike and tight money produce the recession.
Obama’s most egregious error is far worse — his inability to grasp the balance-of-power dynamics among the US, Russia and China.
Apply the Reagan administration as a frame of reference to compare president-elect Trump. Doing so we can see what expectations might be for the economy.