1) Jackson Hole (2020): #Powell said the #Fed is changing its model to where it will not raise rates in the face of rising #inflation since the job market remains on solid footing. Jackson Hole (2021): With inflation surging to 5%...Powell said inflation will be transitory...🧵
2) and there was no reason for the Fed to raise rates. Jackson Hole (yesterday): After raising rates by the fastest pace in three decades, which caused the housing market to crash in six months, an unpresented drop in services PMI...(clear sign consumer spending is plunging)...
3) major retailers (BBY, WMT, TGT) lowering prices to get massive inventory off their books... half of the companies in the S&P 500 about to announce layoffs (from PwC), nonresidential construction spending at 50 year lows... the MASSIVE contraction in M2 (which was the...
4) biggest contributor to the Great Depression)... default rates for speculative grade corporate to more than double by next year (S&P Global)... household wealth plunging (stocks/homes account for 70% of this)... and earnings (ex-energy) down 4% yoy... Powell wants to...
5) aggressively raise rates into next year. Listening to Powell (and the current Fed presidents) on TV today... they have no fkn clue. In fact, if they did the exact opposite of what they said at Jackson Hole the past three years, inflation would be under control, the markets...
6) would be a solid footing and we would not be heading for recession (which is a 100% certainty). I reiterate: If the Fed takes rates above 3.50%... we will see a monumental crash in every asset class. Based on Powell's track record over the past 3 yrs... I'm really fkn worried.
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