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Big Bubbles And ‘Unrealistic Outcomes’
If your aim is to suggest US equities -- which notched more new record highs on Monday, by the way -
Thanks H, I was wondering about this — everyone is making so much cash rn what are they going to do with the profits? Put it back into the mix!
I know you’ve talked about this plenty before, but certainly makes a compelling argument for cutting rates to reduce inflation given the bond income vs. the fixed low rate debt households and corporations stocked up on.
Just watch Trump force the Fed to cut rates to juice the stock market which then causes inflation to drop and him taking all the credit for his big brain moves only to see the stock market tank because all the excess cash flow dried up. It’ll turn out that our economic theories should have been taking a page out of the George Costanza playbook and doing the opposite of every instinct they have.
I do not think the FED does anything instinctual. They are reacting within the playbook of ‘settled theory’. If that is too lame then I guess 1800’s style depressions would be all the rage?