I’ll say this about the Federal Reserve: it tends to follow the script.
Everybody expected that the central bank would hike rates at the July FOMC meeting, and that’s exactly what it did. The Fed boosted the federal funds rate another 25 basis points to 5.25 to 5.5%.
Four months after the failure of Silicon Valley Bank and Signature Bank, the financial crisis sparked by Federal Reserve rate hikes continues to simmer under the surface.
As of the end of the first quarter, Bank of America had over $100 billion in unrealized losses on its bond portfolio. This is the exact problem that torpedoed Silicon Valley Bank (SVB).
You had better get ready for the world of central bank digital currencies (CBDCs) because they are coming. And they are coming fast.
According to a recent survey by the Bank for International Settlements (BIS), as many as 24 CBDCs could be in circulation by 2030.
With three months left, the fiscal 2023 budget deficit has already eclipsed the massive 2022 shortfall.
The US government ran a $227.77 billion deficit in June, pushing the total fiscal 2023 shortfall to $1.393 trillion, according to the Monthly Treasury Statement for June.
The Federal Reserve got just what it needed – an even cooler-than-expected Consumer Price Index (CPI) report card for June. This could give the central bank a plausible excuse to back off its inflation fight.
But make no mistake, inflation isn’t dead or buried.
Most people believe members of the Federal Reserve are highly trained experts who are imminently qualified to run monetary policy. Guided by this perception, the mainstream treats Fed pronouncements as gospel. But if you compare Fed projections to actual outcomes, it looks like they’re just guessing. In fact, you would probably get more accurate results throwing darts at a dartboard.
Today we celebrate insurrection.
No. I don’t mean the fake Jan. 6, 2021, “insurrection.” I’m talking about the bonafide insurrection staged by American colonists against the British government.
We call July 4 “Independence Day.” But the British called it an act of rebellion.
A note recently published by two Federal Reserve economists reveals a looming catastrophe.
The Fed’s interest rate hikes have already precipitated a financial crisis. The central bank managed to paper over that problem and get it out of the headlines with a bailout program. But it didn’t solve the problems. Banks continue to tap into the bailout loans as they struggle in this high-interest-rate environment.
And there are even bigger problems on the horizon.