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Jerome Powell Can’t Find Duration Bubble He Saw Eight Years Ago

As regular readers are aware, I'm generally loath to devote too much energy to lampooning or otherwise deriding technocrats. And that includes the Fed. That doesn't mean these pages aren't chock-full of tedious critiques, impenetrable analysis, and outright tasseography vis-à-vis Fedpseak. Rather, it's just to say that by now, most of the jokes are tired. And when it comes to the role of large-scale asset purchases in perpetuating inequality, the discussion has shifted beyond the mere observation that the wealth divide is growing in part as a result of QE, to more important questions about how to address that by, for example, transitioning to overt debt monetization and mainlining money into the veins of Main Street. There's little to gain in all of this by pretending as though central banks are engaged in some manner of conspiracy or are otherwise actively attempting to impoverish the masses. The fact is, fiscal retrenchment has meant that the burden of sustaining what little growth and inflation momentum exists in advanced economies, falls almost entirely on monetary policy. Given the nature of the tools at central banks' disposal, the inevitable result is asset price inflatio
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7 comments on “Jerome Powell Can’t Find Duration Bubble He Saw Eight Years Ago

  1. kardrak says:

    “The Fed and its global counterparts have inflated an egregious fixed income bubble by driving investors further and further out the risk curve and down the quality ladder in search of any semblance of yield.”
    Good thing Social Security will be there to help those who get slapped down. Oh…wait….well at least they won’t get means tested out of their reduced benefits.

  2. Dana says:

    Getting a reverse mortgage five years ago turned out to not be such a bad idea. In five years our credit line has grown almost to the point that we don’t have to go through the hassles of readying our home for sale, selling it, and paying commissions and paper pushers. It is more lucrative to simply take the accumulated credit line in one fell swoop and walk away.

  3. Jesse says:

    It can’t be a bubble as it hasn’t burst. It’s like we’re living in a world where the concept ‘yet’ hasn’t been invented (yet).

  4. MMcCann says:

    Anybody have Jay Powell’s email address? Somebody please send him this entire HR post…

  5. George says:

    Thanks H……It took a while but you finally got to the gist of all this…. What to do about this mess…!!!! ? I think the smarter people tend to take care of their best interests and the rest , well they do what they always do… That’s what Government is for… reluctantly though !! I can’t see many jokes in this however…

  6. uptownguy says:

    Shifting gears, we need some H eyes on the perpetually anticipated rotation. Even when markets were up big early today, tech was relatively wheezing and it stayed that way all day and on into futures tonight. The “most crowded trade ever” looked like it was slightly more crowded under the Exit sign…

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