Guest Post by Martin Armstrong
Thank you to the reader who sent in this hilarious image. Despite all the incoming data and price instability, some expected the Fed to pivot on its stance. Even BlackRock reportedly told advisers to expect “pivot language” at the last Federal Open Market Committee meeting. They were hoping that the Fed would announce a looser stance for the December meeting despite conditions failing to improve.
The markets correctly anticipated a 75 bps hike for November. Jerome Powell said that incoming data from the last meeting has led the central bank to believe that rates will edge HIGHER than originally anticipated. PCE rose 6.2% over the past 12 months, with core PCE rising by 5.1%. Long ago after Powell changed his “transitory” stance, he reiterated that the Fed’s main goal is to bring levels back to the 2% target. Price stability is the top priority – period.
“As I’ve said in the last two press conferences, it will become appropriate to slow the pace of increases, as we approach the level of interest rates that will be sufficiently restrictive to bring inflation down to our two percent goal. There is significant uncertainty around that level of interest rates. Even so, we still have some ways to go, and incoming data since our last meeting suggest that the ultimate level of interest rates will be higher than previously expected,” the chairman reiterated.
The central bank realizes that the situation will only worsen. “Restoring price stability is essential to set the stage for achieving maximum employment and stable prices in the longer run. The historical record cautions strongly against prematurely loosening policy. We will stay the course, until the job is done,” Powell commented. His Q&A after the announcement only reiterated his extremely hawkish stance (see video above).
Powell said the Federal Reserve is honing in on three main factors: 1) how fast to tighten policy, 2) how high to raise rates, 3) how long to remain on the current course. Powell said they would move “expeditiously” to move rates, especially given the low starting point. He believes that incoming data justifies ongoing rate hikes, and his estimate is higher than what was announced in September. Finally, he said they might have a discussion on when to loosen policy, but there was an emphasis on the word discussion.
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Just looked at Zillow for our area, bloated inventory of homes, prices being reduced but still over priced for any savvy buyer. Higher mortgage rates taking effect, very few buyer driving the neighborhood.
Raising interest rates only works when inflation is from the people living too well, doesn’t do jack when it’s the government living too well. Which is the reason we have inflation in the first place.
Fed is going to continue spending/printing money like crazy no matter what.
And we have a winner.
My father was excited about the COLA increase in Soc Sec payments (8.5%, I think).
I asked him where he thought the extra money he is going to get was going to come from.
He didn’t understand the question or the point of the question.
Government gives you more money to cope with inflation. That money is borrowed (imagined into existence), thus causing worse inflation; which will then be met with more COLAs, and on, and on. Brilliant!
And I would like to reiterate that 2% inflation (really 6 or 7%), year after year, is not “price stability” it is a fleecing. Theft. Fraud.
The Fed is going to keep raising interest rates. It will blow things up and that’s the point. Everyone else will blow up first.
Powell is on a mission. Inflation has little to do with it.
His mission is to debilitate the WEF’s ability to enslave you, as the WEF fronts for legacy Euro Colonialist Banking families.
Powell and Williams, head of the NY FED, have broken ranks with the Eurotrash, and are destroying the Eurodollar Market with these rate hikes. Further the implementation of SOFR, replacing LIBOR is another tell that this is the game afoot.
Yes there will pain for us, but not nearly the same as for the EU and the evil plans his maneuvering thwart is absolutely worth it.
For your consideration:
I listened to that yesterday. Don’t think for one minute that Powell is a man for the people. This is evil fighting evil. They can’t help themselves. The US bankers don’t want to be under the thumb of the European bankers. If Powell etal is successful they will still introduce a CBDC. They still want us under their thumb. But it’s fun to watch them get in a mud wrestling match.
I never said he was not evil, just that the WEF plan for you is far more sinister and evil. Is that not your take away as well?
I play the crypto game, have for years, and consequently follow news and developments regularly. My impression, based upon observation is thus: There is no stopping CBDC, crypto is simply superior technology, that’s it. It’s better, just like cars to buggy’s or any other tech development, you cannot stop it.
That said, I have watched closely and the FED’s inner circle, Goldman. J.P. Morgan, Citi and others are playing as well. Leaving me with the impression that The FED et al are going to allow a vast ecosystem of cryptos in which they add their CBDC.
As opposed to the WEF et al that plan on complete centralization, one CBDC to rule all. When viewed in this light, there is no doubt which group I support or at least prefer.
I am small, giants are doing battle and I have clear preferences for which giants prevail.
By no means does this disable me from acting locally and seeking self control of sustainment and ownership. I can own crypto and gold, I can grow my own food and act locally, I can support the FED and Jaime Fuckin Diamond while doing so, until opportunity for a better option presents itself, which may or may not happen on our way to desired conditions of Liberty.
I can’t help but pick sides but only for shits and giggles. I would like to see the Fed outfox the old money European pukes.
They are a vile bunch and have seriously demonic plans for us. 2 points made in the vid I appreciated, 1 backing them into a desperate corner has produced a need for them to go big and light off WWIII, and 2, we are witnessing a second 1776 moment, or more accurately the American Revolution has been and will be a continual process from these vipers.
But if The FED and Jamie Fucking Diamond are the champions that keep us out of their New World Order then I guess I am turning a new leaf.
Luongo makes a compelling case and has done years of work and hundreds of hours putting it together.
The FED is the ultimate Wizard of Oz, they have the whole world believing they have powers they do not have.
They can not and do not control interest rates. During periods of great confidence, they can influence, but that is only due to the markets willingness to be led. During times like this you find out they are powerless to dictate anything. They are currently losing 4 billion dollars a month… If they were capable of stopping that, they would.
Few people realize it was the FED that went bankrupt in 1933, and necessitated the confiscation and revaluation of the peoples gold to bail them out.
So rates will just go up and down like a see swa, huh?
As this comment is typed, the Dow is up on the positive jobs report (wink, wink). As if by unseen helium, the markets have significantly risen over the last two weeks. What if the plan is for a financial crash if the Republicans win bigly this Tuesday? Surely the Loony Left and Orwellian Media would say the markets saw the writing on the wall: Democracy is in danger.
The positive jobs means the Fed has to keep raising rates. No matter if it’s part time jobs.
The Fed is not raising the rates, the treasury market is. The governments spending spree is financed by the treasury market, and there is a limit to how much money people are willing to lose to loan the government money.
When inflation was 2% and treasuries were paying 0% the people investing in treasuries were losing about 2%. Now with inflation at 8% and treasuries paying 4% they are losing 4%.
This is not sustainable and they are demanding higher interest, and the government has no choice but to pay it. The Fed must then adjust their rates to match the changes in the treasury rates.
Interest rates will continue to chase inflation rates until they reach equilibrium. This will induce recession and loan defaults destroying mass quantities of money and removing it from the system which is will lower inflation.
Federal Open Mouth Committee
