Rich, another great report! I also appreciated the links you provided to the Bank of Japan story (mopping up liquidity and the effect on our stock market).
In regard to your comment on “one and done”, I doubt this can happen. I think the commodity bull market and energy supply/demand imbalance are causing inflation, which is starting to show in prices. The Fed must keep raising. They can just say they’re responding to new data. After all, it’s been only in the last few weeks that higher energy prices are flowing through to goods and services.
Second, as other central banks raise their interest rates, we must raise ours to stay competitive.
Although the Fed would like to be one and done to avoid further dampening consumer spending and the stock market, I think they have little choice but to keep raising.
I have a question: is the Fed increasing liquidity by “printing money”, or are they auctioning off more debt? My brother says it’s the latter, which has the unpleasant side effect of costing us interest. If they would just “print” money, it would cause inflation, but it’s a cheaper way to increase liquidity.
.
