Ray Dalio’s Fed Take And Markets As Functioning Alcoholics
"It's easy to say that the Fed should tighten. And I think that they should," Ray Dalio said Monday, in remarks to the Qatar Economic Forum.
The problem, he lamented, is that they can't -- tighten, that is.
I spent what you could fairly describe as an inordinate amount of time last weekend going on about why it's mostly impossible for central banks (and especially the Fed) to truly "normalize" policy after a dozen years spent chasing ever farther down the accommodation rabbit hole. I'd immodes
Where does one hide from such an event, if it occurs??
https://www.amazon.com/Under-Influence-Guide-Realities-Alcoholism/dp/0553274872
Alcohol is exactly like heroin once it’s metabolized. Twice. Another, perhaps, useful metaphor for the current situation.
Gonna have to call BS on that one… addiction/biological reward mechanism may be similar, but besides that and the ability to make you pass out, they are very different things. Essentially the same as prescription painkillers though.
I’m not sure how to leave aside the widening wealth gap in our country from this conversation… Isn’t that THE story right now, both economically and politically?
Every article can’t be Thomas Piketty. There’s only so much time in a day.
Unless we grow our economy, which most likely will require significant immigration, the Federal Reserve will morph into BOJ.
The other alternative is we “reset”- which seems like that would be followed by war as we protect our own and try to take over other groups of people- resulting in significant loss of life, human and other, and possibly destroying the planet in the process.
Don’t be so sure the labor market is out of the woods. The next shoe to drop is white collar employment. See Exxon Mobil today as a good example. It is the second and third order effects that can get you. Like the GFC the economy is going through 10 years of restructuring in roughly 3 years. The fed is likely going to be singing a much different tune 6 months from now.
“The next shoe to drop is white collar employment.”
This is very logical move, and not only for Exxon. The number of white collars in industry is outrageous. It places a heavy burden on internal manufacturing costs, forcing companies to buy (In China, India etc) instead of in-house manufacturing.
H. If you didn’t detoxify you wouldn’t be here holding the rest of us together. If the fed doesn’t detoxify where will it end up?
The FED, like any good heavy drinker could do the hard work for 30 years, what else we gonna do? Pretend politics will come to the rescue any time soon.
The Fed/US government only needs to remain a half step more responsible than any other significant currency printer/economy.
To follow your functioning alcoholic narrative (which I agree with by they way). When has being an addict ever just “worked out”? In your case you medically had to quit the booze in the most violent way possible to stay alive. Others just end up dead. Now lets apply that to the Fed, there is no way to keep running this the way they are and not face consequences at some future point. I’ve said it before and I’ll say it again, the longer we wait to stop this nonsense the worse it will be for everyone when it finally falls apart. Either the US Dollar will be worthless or all of the assets being bought by the Fed will be. If not both.
Your personal stories make for some good reading (as well as market coverage)
Ever consider an autobiography? May be a worthwhile effort.
My college roommate was a functioning alcoholic at age 16. His freshman year he had the DTs frequently when he couldn’t get a ride to a bar (my school was dry, no cars allowed until Junior year, town was dry as well). He had to drink at least four ounces of vodka neat just to start his homework. He had a 3.5 average and ran European operations for a large bank for ten years. Never quit so now at 75 he has late stage alcoholic dementia. He tried to quit once, didn’t work. His twin is a doctor and still he wouldn’t quit.
I love these articles that reference your life — or past life, in this instance. You should write an extended “About Me” post, one that obscures all facts that necessitate obscuring but touches on current conditions too, like the AM cigars, if I recall correctly. Would love to know what your post-former-self routine looks like, professionally.
I had some extremely wealthy friends…….take functioning alcoholic and add cocaine…….it smoothed out the rough edges…..a round of golf was a beer/shot per hole……..7 of 15 never reached 55……Powell drinks wine with dinner….