In recent lectures and meetings with clients we have highlighted the steps required to fire the US economy. These meetings take about 10 minutes; then we’re all off for a good IPA.
Background: We have an over-reaching administration and a complicit Fed. Most members of the FOMC are willing to keep quiet and go along with the Chair, ignoring the incest close at hand. Family reunions in the Deep South run a distant second.
For years, for us, the FI auction market offered up adventure and fair play, with victories and mishaps along the way; it was a rough game but in an arena where everybody knew the rules. There were, to borrow from TR, “great devotions and great enthusiasms.”
Now we find this arena to be a sordid place; the game is rigged by crony capitalists turned planners who pick the winners.
The Fed and the administration are co-conspirators. Their foray at the gaming table suits both very well, but not most Americans.
The key for a return to a vibrant American economy is for the Fed to regain its credibility by targeting 2% inflation. That was easy.
The “dual mandate” is a redundancy; it’s stupid. Stop the QE bit, stop the kumbaya bit with the investment crowd, reduce interest on reserves to 0% (in two steps), adopt a reasonable FF’s target and then stand back. When we see 2% inflation (headline PCE), fine; lift FF’s.
Things don’t have to be so terribly complex; this – complexity – is indeed the final refuge for the scoundrel, or in this case, for the conjoined heads of Fed and administration.
Our advice to Obama is to stop the incessant meddling, a signature of his party; our advice to FOMC members is to stop the assault on seniors before you’re all put under house arrest, or worse.
Let’s put this reeking chapter behind us.
Robert Craven
Background: We have an over-reaching administration and a complicit Fed. Most members of the FOMC are willing to keep quiet and go along with the Chair, ignoring the incest close at hand. Family reunions in the Deep South run a distant second.
For years, for us, the FI auction market offered up adventure and fair play, with victories and mishaps along the way; it was a rough game but in an arena where everybody knew the rules. There were, to borrow from TR, “great devotions and great enthusiasms.”
Now we find this arena to be a sordid place; the game is rigged by crony capitalists turned planners who pick the winners.
The Fed and the administration are co-conspirators. Their foray at the gaming table suits both very well, but not most Americans.
The key for a return to a vibrant American economy is for the Fed to regain its credibility by targeting 2% inflation. That was easy.
The “dual mandate” is a redundancy; it’s stupid. Stop the QE bit, stop the kumbaya bit with the investment crowd, reduce interest on reserves to 0% (in two steps), adopt a reasonable FF’s target and then stand back. When we see 2% inflation (headline PCE), fine; lift FF’s.
Things don’t have to be so terribly complex; this – complexity – is indeed the final refuge for the scoundrel, or in this case, for the conjoined heads of Fed and administration.
Our advice to Obama is to stop the incessant meddling, a signature of his party; our advice to FOMC members is to stop the assault on seniors before you’re all put under house arrest, or worse.
Let’s put this reeking chapter behind us.
Robert Craven
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