System couldn’t handle QT in 2018. Hey lets try it again and expect a positive result. (Spoiler: It’s going to be worse.)

The Fed has ratcheted up interest rates this year, but that’s only half of its approach to fighting inflation and taming frothy markets.
Quantitative tightening is meant to suck excess liquidity from the market, fighting inflation and deflating bubbles.
Experts say there is the potential it goes too far, but the Fed can avoid a crisis if it eases up on QT gradually.

gasoline demand last week- very weak… data incoming

— Patrick De Haan ⛽️📊 (@GasBuddyGuy) November 6, 2022

63% of Americans are living paycheck to paycheck, CNBC reports.

— Watcher.Guru (@WatcherGuru) November 7, 2022

The Federal Reserve has to do the “dirty work” of bringing labor demand down to match supply, Bank of America analysts said.
As a result, the US will face a deeper recession than Europe, where the labor market is already much weaker.
BofA sees the Fed hiking the benchmark rate to 5.25%, while the European Central Bank’s terminal rate will be 2.5%.

Economist Nouriel Roubini has warned the Federal Reserve will have to trigger a recession.
The US central bank has hiked interest rates from near zero to 4% to curb soaring inflation.
Here’s “Dr Doom”, Sam Zell and other top experts on what damage that could do to the US economy.

We are primarily funded by readers. Please subscribe and donate to support us!

The global recession has arrived…

China’s exports and imports fell in October in U.S.-dollar terms, according to customs data released Monday.
That decline missed Reuters expectations for growth in both categories.
China’s exports to the U.S. fell in October for a third-straight month.

Views: