Since inflation is just too dang low and since tensions around the globe are on the rise, the Fed just might have to cut rates. Here’s why it matters…
The Fed is back to doing what it does best – jawboning.
This time, in the form of Fed Head Bullard whispering sweet nothings to the “markets”.
Here’s more, from CNBC:
A U.S. interest rate cut “may be warranted soon” given the rising risk to economic growth posed by global trade tensions as well as weak U.S. inflation, St. Louis Federal Reserve president James Bullard said Monday, the first Fed official to say recent events may require a central bank response.
Of course, about 80% of the nation understands that not only is inflation not “weak”, but inflation is actually spiraling out of control.
Of course, if you don’t get what he really means, well, he’s not talking about the price inflation that he or anybody else at the Fed doesn’t feel and suffer in the form of the devastating price increases US consumers must pay on everything from housing, to autos, to college tuition, to food, to services and to entertainment, but rather, he’s talking about the price of stocks and real estate.
And by “global trade tensions”, Bullard can point to that as an easy excuse for taking the “required” action to prop-up the bank account balances of the Fed’s globalist buddies.
OK, “Hey Half Dollar, is this just another one of your stupid rants, or what?”.
There is a point here – gold is the ultimate hedge against inflation.
Silver is too.
But it gets even deeper than that.
You see, the Fed and the government understate inflation, in part, to justify their unnaturally low, suppressed interest rates, and these low interest rates are so low, that when subtracting for real inflation and not the dog-n-pony show inflation, real interest rates are actually negative.
Yet now Bullard is prepared to cut rates even lower?
CME Group is even showing a significant probability of the Fed actually cutting rates in just a couple of weeks from now:
In fact, many of the experts & pundits are calling for a modest Fed cut in interest rates this year.
You can think about it this way too, and this is the key take-away – The Fed, as evidenced Bullard, just today, wants the dollar to lose 2% of its purchasing power every single year, and on top of that, the Fed wants the prices on everything to go up 2% per year.
Why anybody keeps any money in the bank beyond the bare minimum necessary for modern 21st century living is anybody’s best guess?
Mine is that it’s because people are, for the most part, ultra-lazy, and they would rather succumb to a slow, painful descent into economic misery and financial ruin than actually embrace the needed change.
When you take the opposite side of the Fed, one of two things happens.
You will die waiting for gold & silver to have their day in the sun.
Or you will have life-changing gains in personal wealth.
People have died waiting, and for decades now.
Which means we are closer than ever.
To life-changing gains in wealth.
That can only be found.
In all of our history.
In gold & silver.
– Half Dollar