The Fed’s Balance Sheet May Be Headed to $40–$50 Trillion
President Trump has said often that he had “created the greatest economy the world has ever seen, until the China virus came.” Maybe some people believe that, but if the economy was so great why did the Fed keep interest rates at zero and its balance sheet at $4 trillion?
The president is bragging about the third quarter GDP bump; however, as David Rosenberg tweeted, “Even with the Q3 GDP snapback, a snapback that is now stalling, 2020 likely goes down with a –4% print, by far the worst year for the economy in the post-WWII era.”
Maybe the economy wasn’t so hot. Danielle DiMartino Booth, who once worked for Richard Fisher at the Dallas Fed, told Raoul Pal on Real Vision,
September the 16th , when they launched Not QE. Because the inversion of the 2s 10s had passed the 30-day mark, and they’re like, oh my god, history says that we’re in recession.
Well, no kidding, we’re in recession. World trade was contracting for the entire year of 2019. Lacy Hunt will tell you, you have to go back to the double-dip recession of the 1980s or 2007- 2009, that era, before you had global contraction in global trade. Of course, we were headed into recession. But it was very slow.
There were the good old days when the Federal Reserve’s ba
Article from Mises Wire