Wolf Richter sums up the last fourteen years.
A good one for asset rich, about to bleat, 'home owners'
https://wolfstreet.com/2022/10/11/somet ... stability/
Something Big Has Already Broken: Price Stability
The years of QE and near-0% interest since 2008 have created the Everything Bubble, and now the Everything Bubble is deflating.
And these hedge fund gurus and bond kings and stock-fund apostles and other crybabies on Wall Street are saying that things are already breaking, that markets are stressed, and that in x months, like in November, something big will break that will cause the Fed to pivot into cutting rates and restarting another money-printing binge.
That’s what they want: They want the Fed to cut rates and restart QE as to re-inflate the Everything Bubble so that these folks can get even richer. They have big investments, and those investments have now soured, and they want the Fed to U-turn in order to bail out their investments.
And they don’t give a hoot about this raging inflation because they’re rich and don’t even notice if they have to pay extra for consumer goods and services.
And if something breaks, meaning if some portion of the market crashes somewhere, or rates blow out somewhere, say in the repo market like it did in late 2019, that no one outside the repo market even noticed, or if something even bigger breaks, they hope that the Fed would then cut rates and restart QE to re-inflate their asset prices.
And in fact, they want something to break, they’re praying for something to break, they’re trying to scare markets so that something will break, in order to force the Fed into this pivot.
The simple fact is this: stocks, bonds, the housing market, cryptos, etc., etc., they were all hyper-inflated by years of the Fed’s money printing and interest rate repression, that started in late 2008. And after a brief pause in 2017 through 2019, the Fed went hog-wild starting in March 2020 when it printed $5 trillion in two years and threw it at the markets.
"Human beings are poor examiners, subject to superstition, bias, prejudice and a profound tendency to see what they want to see rather than what is really there." - M. Scott Peck