Read the Beforeitsnews.com story here. Advertise at Before It's News here.
Profile image
By Global Macro Monitor
Contributor profile | More stories
Story Views
Now:
Last hour:
Last 24 hours:
Total:

How The U.S. Made Inflation Worse

% of readers think this story is Fact. Add your two cents.


Not a bad primer video from CNBC on the Fed’s policy mistakes, which all are now, literally, paying for.

I would add that monetary policy is a black box, mainly because we can’t define the money supply, much less measure it.  Using your brokerage account to write checks to pay for gas and groceries, for example, shouldn’t it be counted as part of the money supply?  Ditto for crypto, among others

Exogenous vs. Endogenous Money Supply 

No distinction either between exogenous money (created by the Fed) and endogenous money created by the private sector.  The Fed tries, and we stress, tries to control the endogenous money supply by interest rates and the exogenous money supply by its balance sheet.

Endogenous money is primarily created by leverage and is most likely easier to bring inflation down as assets deflate and credit slows.

The current inflation we are experiencing was mainly driven by exogenous money – Fed printing- and is much harder to break until quantitative tightening really begins to bite.  Think middle of 2023.

So, realize, folks, if asset prices are increasing, such as stocks, with a 10 percent inflation rate, it is inflationary.

The Fed has a tiger by the tail, mainly of its own doing, by allowing monetary policy to be, in the words of my good friend Professor Constantin Gurdgiev, “hijacked by Goldman Sachs and Black Rock.”  Let’s throw in Jim Cramer just for fun.

The body politic gets it is unfair, and we see the political angst played out in today’s society.

Even a monkey will revolt against unfairness and inequality.

Money Quotes:

The two following money quotes from the vid could have been lifted straight from the Global Macro Monitor.

  • If we were actually measuring inflation in a consistent manner, the peaks in the seventies and eighties are actually much more similar to the peak today than we would have initially thought.” 

    See our post,  Today’s Inflation Rate And Nolan Ryan’s Fastball

  • “So I think at this point the Fed has to stick to its guns, even if that means taking speculators down.  And that really is what has scared the Fed in the past.  The Federal Reserve is supposed to make monetary policy in the whole of the public interest, not just that of investors. And this going to be a test of which they have not really had to take since 1981.” We have written many posts on this issue, but see this one, in particarlur,  The New “Supply-Side Economics” Fueling Asset Bubbles



Source: https://global-macro-monitor.com/2022/08/16/how-the-u-s-made-inflation-worse/


Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.

"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

Please Help Support BeforeitsNews by trying our Natural Health Products below!


Order by Phone at 888-809-8385 or online at https://mitocopper.com M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at https://www.herbanomic.com M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at https://www.herbanomics.com M - F 9am to 5pm EST


Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation

Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)
Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen! 
Nascent Iodine - Promotes detoxification, mental focus and thyroid health.
Smart Meter Cover -  Reduces Smart Meter radiation by 96%!  (See Video)

Report abuse

    Comments

    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    MOST RECENT
    Load more ...

    SignUp

    Login

    Newsletter

    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.