“Fed’s balance sheets caused inflation, not low rates”

 

This is a widely held belief and behind a lot of the current bearish positioning… (lol I’d like to ask them then why prices collapsed 40% when they first increased the reserves at Depositories in March 2020)

Now they are of course predicting a catastrophic collapse when Fed starts to decrease reserve balances… which btw the Fed haven’t even done yet in June when this is the month they have been saying they are going to decrease assets, excerpting from Mike’s MMT Trader report this week:

“Fed QT is proceeding slowly, if at all. In the week ending June 22, the Fed’s balance sheet increased $1.9 bln. It was the fourth week up and the highest level in 5 weeks”

Still a week to go in June but as of the 22nd here they have made only negative progress towards their stated policy… These people are the worst I have zero technical respect for them…

"Catastrophic Risk To Stocks And Bonds": Fed's Balance Sheet Caused Inflation, Not Low Rates https://t.co/7bAtlkAqot

— zerohedge (@zerohedge) June 28, 2022