The Macro Moment: We Are Heading Into A Recession
The Fed is listening to the stakeholders and raising interest rates. This is insane but it is the path they are taking.
In this video, I discuss how things are getting worse and things were heading down before the Fed started its tightening. We are going to see a worsening of the economic system.
Many of the reasons are in the video.
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Until a massive collapse, the money printing will contine. The extreme infltion will kill the higher interest rate and people will loose their assets value. The current system has no protection for common people economic freedom but there is extreme vulnerability to down the economy. Let's see how far the outdated system can sustain🤔
Well this is misleading at least with the major currencies. The Fed doesnt print USD so the impact upon inflation simply is not there.
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Yeah, majore currencies are safe and that should be for the sake of real world. But there are many more currencies are suffering from inflation very badly. In some cases, money printing is crucial here.
The situation is also compounded in many of those countries due to the fact that the USD is also running. That is what kills the emerging markets although all currencies, large and small, have been getting killed to the USD.
It is still the safety run.
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That is why it is interesting to listen to all those directly or indirectly involved and seek an intermediate point between all of them for the maximum economic development of the parties.
Having a large cross section of information is vital. The problem with the Fed is they focus upon one or two pieces of data. With this it is jobs/unemployment.
To me, that is misleading.
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Isn't the plan to keep the masses unaware? The masses have a massive amount of underutilized capital that, if they knew more and were included more, could be used to actually move the needle.
It's crazy that it's 2022 and we have a widely effective anti-populism narrative. It's almost like ESG entities collaborate and collude to keep the masses ignorant. They'll never allow another Occupy Wallstreet and the narrative will always be used to castigate the small person.
We have a small number of companies and powerful groups, some shadowy, that disseminate the real alpha out to others.
I agree 100% with your point about the double-booking of job numbers. We're in for a tough time and people are completely delusional, in denial or outright can't admit that because it would be colossal.
That is true. But you have to consider who is keeping them unaware. Even the financial media is unaware, since they are useful tools.
Even the people who claim to be aware are mostly unaware what takes place. As 1,000 people what they know about the Repo market and you will see how clueless they really are.
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The job market hasn't been rosy for a while and the numbers haven't really changed. Powell just keeps talking like there is a lot of room because there are more jobs than people being hired but it hasn't changed the fact that this has been the case for a while now. I fully expect a recession because the stimulus money has dried out and there won't be the funds to do discretionary spending.
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The JOLTS is way over stated. Sad that so many buy into it.
We are not seeing a ton of hiring, especially in manufacturing. The reports keep telling the same story.
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OK. You've made some things clear. How long do you estimate the recession will last?
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No clue. We have been mired in awful economic conditions since the Great Financial Crisis.
Unfortunately, these things tend to get named in hindsight. But we can expect the easing to restart.
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STOPCheck out the last post from @hivebuzz:
Summary:
In this video, Task discusses the recent decision by the Federal Reserve to raise interest rates by 0.5%, pointing out that it's not the solution to combat inflation as many believe. He argues that the Fed didn't directly cause inflation, attributing it instead to supply chain issues and other factors. Task emphasizes that the Fed can influence but not control the economy, reiterating that the market dictates interest rates. He predicts a recession in the second half of the year due to various economic indicators like slowing real estate, job market struggles, and lackluster GDP growth.
Detailed Article:
Task's video delves into the Federal Reserve's recent move to increase interest rates and challenges the prevailing narrative that higher rates are necessary to combat inflation. He asserts that the Fed is not the sole driver of inflation, suggesting that supply chain disruptions are major contributing factors. Task dismantles the misconception that the Fed directly causes inflation by highlighting that the central bank's actions are more about influencing economic conditions rather than triggering inflation.
Furthermore, Task offers insights into the relationship between supply chain issues, inventory levels, and demand destruction. By emphasizing the cyclical nature of commodities, he explains how price hikes can lead to further price increases, a common phenomenon in commodity markets. Task critiques mainstream financial media for oversimplifying economic dynamics and refers to inflationists and gold bugs as being shortsighted in their predictions.
Transitioning to the real estate market, Task notes that price stabilization began before the Fed's interest rate hikes, illustrating the market's inherent complexities. He outlines the difference between real estate and equity markets, predicting a slowdown rather than an abrupt reversal in real estate price trends. Task discusses how rising interest rates impact affordability and mentions the role of mortgage rates in shaping the real estate landscape.
The conversation shifts towards the job market, with Task critiquing inflated job numbers and emphasizing the significant impact of real estate on employment. He highlights the interconnectedness of real estate and job market dynamics, suggesting that layoffs in the mortgage industry could signal impending disruptions in the housing market. Task portrays a nuanced view of the economic recovery, pointing out weaknesses in labor force participation and wage growth.
In conclusion, Task underlines his forecast of an upcoming recession in the latter part of the year, attributing it to the end of stimulus measures, weak job market conditions, and subdued GDP growth. He cautions against overzealous optimism about the economic recovery and advises a more critical evaluation of economic indicators and trends.